Beijing's will to depreciate the global economy and make the Chinese wan the new world reserve currency in the dollar position is given. Based on the principle that whoever owns the most «strong» It also controls the global economy.
But how close is China to meeting this goal? Can the Chinese Wan really become a dominant reserve world currency in the dollar position?
In international monetary economic practice, a currency acquires «reserve status» where it simultaneously performs three functionalities at international level.
The first is to be a transaction instrument, i.e. to be used in trade, payments and clearing of commercial and investment transactions.
The second is to be a unit of value measurement, in the process of pricing goods and contracts, such as gold, oil and other commodities that are freely traded on the markets.
And the third is to be a means of safeguarding value, or like the international term. «store of value», portfolios of central banks and institutional investors.
The numbers give the corresponding answers on their own.
Wan's share of world official exchange reserves, known as «allocated reservations» It is currently around 3%. An extraordinary low percentage. Especially against 60% of the dollar and 20% of the euro. And this indicator highlights the deep «sub-representation» Wan in relation to the size of the Chinese economy. Which is the second largest worldwide relative to its GDP, i.e. its Gross National Product. The main cause of this distortion is the controls on the capital movements implemented by Beijing in the context of the «protection» the currency of the country.
Of course, Wan already has official institutional status through its inclusion in the IMF SDR basket (Special Drawing Rights), with a weighting of 12.28%. The third largest weighting after the dollar and the euro, but in front of the Japanese yen. However, institutional recognition by the IMF has not been translated into corresponding adoption by reserve managers.
In the indicator of international currency use through the SWIFT (Society for Worldwide Interbank Financial Telecommunications) international capital transfer network, Wan's share shows instability. Its use had peaked at 2024 reaching 4.74% of capital transfers to retreat below 3.00% within the first half of 2026. Proving that the trend is not steadily upwards. Something that contradicts the most optimistic narratives about «rapid internationalisation» at least with regard to capital movements. However, 30% of Chinese trade is settled in waan from just 10% a decade ago, mainly through bilateral settlement agreements, but also the alternative CIPS payment system (Cross-Border Interbank Payment System), which acts as a substitute for the Western SWIFT.
In the field of commodity and contract pricing, where Beijing expects the most dynamic intervention, some oil future contracts are negotiated in Shanghai, as well as lithium and rare land in Gugchau. Small steps ahead of the Chinese national goal to decommission global commodity markets.
In order to make the Wan a real world reserve currency, China should be «tolerated» greater variability in capital flows and, where appropriate, the creation of trade deficits, so that it can be able to «export» Wan abroad. Something that comes into direct conflict with Beijing's long-term priority aimed at financial stability and strict exchange rate control. In other words, as long as the Chinese leadership treats capital controls not as a temporary obstacle or support that will eventually be lifted, but as a cornerstone of policy practice then things for the wan will remain difficult.
To accept the Chinese Wan as the new world reserve currency, it is Beijing that needs to be adapted rather than the other way around. The markets will not enter the Chinese restrictions, but instead the wan should move to the logic of freedom.
The prevailing view is that Wan cannot be developed as an international reserve currency without the full liberalisation of capital movements. So investors can freely buy and sell Wan without state restrictions and interference. This is based on the historical precedent of sterling and the dollar, which became leading international currencies moving on free and open markets, with depth and liquidity.
The lack of open bond and share markets is also an important deterrent. In China today there is no developed secondary sovereign debt market, comparable in depth to the American Treasury market, so institutional investors can enter and exit large positions without significant market price impact. And stock exchanges remain hostages to opacity and accounting alchemy.
Freely traded waan, open secondary bond and stock markets, which are foundations for the formation of a strong international reserve currency are outside Beijing DNA. And as long as this does not change, the strengthening of Wan and its emergence into an international reserve currency will remain a plan on paper, within the 15-year plans of the Communist Party of China and nothing more.
