LONDON (Reuters) - China has no timetable for the full convertibility of its currency though it plans to make the yuan convertible on the capital account eventually, the country’s central bank chief said on Thursday.
“China has published a plan (that includes convertibility for the yuan on the capital account). Up to now, the plan does not define a clear timetable for full convertibility,” People’s Bank of China Governor Zhou Xiaochuan said.
He was commenting on media reports that quoting the president of the European Union Chamber of Commerce in China as saying he had been told by Chinese officials that Beijing would make the yuan fully convertible” by 2015.
Zhou also said China saw no “special urgency” in having the yuan including in the basket used to calculate the value of the International Monetary Fund’s Special Drawing Rights (SDR), though it welcomed discussion of the idea as a way to improve the global currency system.
Asked by reporters how global economic imbalances should be addressed, Zhou said it needed a “concerted effort by all the major economies in the world.”
He said the G20 was a good forum to discuss such coordination.
Finance ministers and central bankers of the Group of Seven (G7) developed nations, which does not include China, are meeting in France this weekend to discuss the global economy. Zhou did not mention the G7 meeting.
Even as they coordinate, “each country should act to sort out their own domestic imbalances,” he said, adding that China was working to boost its domestic demand.
Asked how China would respond to further quantitative easing by the U.S. central bank, Zhou said he understood that the United States needed to secure a recovery of its economy but he added: “There should be coordination and when setting monetary policy, countries should consider the impact on global liquidity.”
China and other emerging economies criticized the last round of U.S. quantitative easing as destabilizing for global markets.
Zhou said China welcomed London’s aspirations to become an offshore trading center for the yuan but said the city appeared to be moving “faster than we expected” and the market would ultimately decide.
Internationalizing is a “long term process” of exploration and experimentation, he said.
He said any move by London to trade the yuan would not affect the status of Hong Kong as an international center because the territory had strong markets and played an important role in China’s development.
Reporting by Sebastian Tong; Editing by Toby Chopra