The International Monetary Fund (IMF) has hinted that it may accept the Chinese yuan as a currency for countries to settle their obligations to the IMF, following the recent repayment of Argentina’s debt in yuan.
IMF spokesperson Julie Kozack confirmed that Argentina had repaid part of its debts – equivalent to $1.1 billion of the $2.7 billion that fell due last month – to the IMF in Chinese currency.
“As we have stated in the past, the Argentine authorities continue to meet their financial obligations to the IMF,” Kozack said at a press briefing.
“The RMB is one of five freely usable currencies that members can and have used to settle their obligations to the IMF,” she added, referring to the Chinese currency by its official name, the renminbi.
Argentina’s central bank said it had incorporated the yuan as an accepted currency for deposits in savings banks and checking accounts, signaling its move away from the U.S. dollar as the sole official reserve currency.
“Financial entities will thus be able to open bank accounts denominated in renminbi yuan,” the bank said.
Besides Argentina, Brazil also signed a deal with China earlier this year that would allow them to trade and invest in their own currency, further reducing the dominance of the US dollar.