G20 should form currency reform secretariat: Chinese official

BEIJING: The Group of 20 countries with the world's leading economies should establish a secretariat to promote reform of the international monetary system, the head of China's national pension fund said on Sunday.

The US dollar remaining the major reserve currency of the world is hindering freer currency flow, Dai Xianglong, chairman of China's $130 billion National Council for Social Security Funds, said at a conference in Beijing. "The G20 should take reform as a serious task," said Dai, also former head of China's central bank. "There is no other major change taking place now in the international system."China has been pushing for a higher profile and greater acceptance of its currency, the yuan, as an international reserve currency to rank alongside the dollar.

"China is the largest creditor in the world, so the renminbi is naturally in the position to become internationalised," Dai said.

The Chinese currency is stable and increasingly used in international transactions, including in cross-border trade settlements, so it is in effect becoming a reserve currency, Dai said in a speech to a meeting of the China Center for International Economic Exchanges.A concerted effort by G20 countries to reform the international monetary system "will be a big responsibility of major parties, but we can form a consensus and move forward and help bring financial stability to the world," Dai said.

Copyright Reuters, 2011