Xi’s remarks were outlined in a speech delivered in 2024 to senior provincial and ministerial officials and later published on Saturday in Qiushi, the Communist Party’s leading theoretical journal. The publication of excerpts from the address comes at a time of heightened volatility in global markets and growing scrutiny of the dominance of the US dollar, adding significance to Beijing’s renewed emphasis on currency strength and financial resilience.
In the speech, Xi set out what he described as the essential characteristics of a global financial powerhouse. These included a solid economic foundation, world-leading technological and industrial capabilities, and a widely accepted and credible currency. He argued that currency strength was inseparable from broader national competitiveness and institutional capacity, noting that financial influence must be supported by real economic and technological power rather than short-term market movements.
Xi also stressed the importance of a capable and independent central bank able to implement effective monetary policy and macroprudential management. He said globally competitive financial institutions, along with influential international financial centres, were necessary to attract global capital and exert pricing power in international markets. According to Xi, these elements must be matched with strong regulation, a reliable legal framework, and a deep pool of skilled financial professionals to ensure long-term stability and credibility.
While acknowledging China’s scale in global finance, Xi noted that the country still faced structural limitations. He said China ranked among the world’s largest economies in terms of banking assets, foreign exchange reserves, and capital market size, but remained “big but not strong” overall. Transforming China into a true global financial powerhouse, he added, would be a gradual and long-term undertaking rather than an immediate achievement.
Beijing has promoted the internationalisation of the yuan for more than a decade, with measurable progress in its use for cross-border trade settlement. The currency’s role in global markets, however, remains limited when compared with established reserve currencies. China’s Cross-Border Interbank Payment System currently clears an average of about 700 billion yuan, or roughly 100 billion US dollars, in transactions each day. This figure remains well below the nearly 2 trillion US dollars cleared daily through the dollar-based Clearing House Interbank Payments System.
Yuan-denominated debt issuance in international markets also accounts for a small share of global activity, representing less than one percent of total issuance. These figures highlight the gap between China’s ambitions and the yuan’s current global footprint, despite steady domestic financial expansion.
In recent months, the yuan has generally held firm against the US dollar, even amid trade tensions and uneven global growth. This stability contrasts with the sharper depreciation seen during former US President Donald Trump’s first term, when market observers speculated that Chinese authorities tolerated a weaker currency to offset the impact of tariffs. International investment banks continue to argue that the yuan remains below its long-term fair value, reflecting both policy controls and cautious foreign investor sentiment.
The republication of Xi’s speech signals continuity in China’s financial strategy rather than a sudden shift. As global markets navigate uncertainty and reassess existing monetary structures, Beijing appears intent on steadily advancing its vision of a stronger yuan and a more influential role in the international financial system over the long term.
