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Renminbi likely to be used more internationally, says Lagarde

Chinese currency the renmnbi (RMB) is likely to be used more widely around the world in the aftermath of financial reforms, the head of the International Monetary Fund (IMF) has said.25 Mar 2015

"I am very impressed by the rapid internationalisation of renminbi in recent years," IMF managing director Christine Lagardee said in a statement. "The authorities' commitment to accelerate reforms, particularly in the financial and external sectors, should further facilitate the international use of the RMB."

Lagarde was speaking at the end of a five day visit to China, where she met Chinese premier Li Keqiang and other officials.

Lagarde noted the "impressive efforts" made by the Chinese government several areas: in strengthening its legal framework and its anti-corruption campaign; in curbing pollution; and "further participation in multilateral dialogue and … more international investment and trade," she said

"I welcomed China's various initiatives in this area, including the newly established Asian Infrastructure Investment Bank," Lagarde said.

Chinese authorities have also expressed interest in having the RMB included in the special drawing rights (SDR) basket, Lagarde said.

The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries’ official reserves. Its value is based on they value of several international currencies – currently the US dollar, euro, yen and pound sterling.

Lagarde said she had also discussed delays in implementing the IMF's 2010 quota and governance reform.

Quota subscriptions are a central component of the IMF’s financial resources, the IMF says on its website. "

Each member country of the IMF is assigned a quota, based broadly on its relative position in the world economy. A member country’s quota determines its maximum financial commitment to the IMF, its voting power, and has a bearing on its access to IMF financing.

Quotas are reviewed regularly, usually every five years, according to the IMF, but in 2010 the review involved a package of far-reaching reforms of the fund’s quotas and governance. 

"I share the authorities' view that every effort should continue to ensure that these reforms can be made effective as soon as possible," she said.

The RMB became one of the world's top payment currencies early this year, according to figures compiled by the Society for Worldwide Interbank Financial Telecommunication (Swift).