African countries consider using yuan as a reserve currency

Beijing. May 31. Silkroadnews - A number of African countries are considering the possibility of using the yuan as a reserve currency, which will facilitate its internationalization, Global Times reports.
The possibility of using the yuan as a reserve currency has become an issue at the agenda for meeting of officials of 17 central banks and governments from 14 countries of the eastern and southern Africa in Harare, the capital of Zimbabwe.
Gladys Siwela-Jadagu, representative of the Macroeconomic and Financial Management Institute of Eastern and Southern Africa (MEFMI), stated that most MEFMI countries receive loans or grants from China, and the possibility of these loans repayment in yuan will be more reasonable in terms of economic sense.
Most of the reserves of most countries in the MEFMI region are still in US dollars, Siwela-Jadugu noted, but growth of the Chinese economy status, as well as growing trade volume with Africa, can change the balance.
In the first four months of this year China’s trade with South Africa increased by 14.7%.
The Chinese government is now expanding its efforts to promote the yuan internationalization.
The yuan was included in the IMF’s basket of reserve currencies in October 2016 and many European central banks have boosted holdings of yuan in their foreign currency reserves, the agency reminds.