China's yuan could emerge as a strong international currency amid weaknesses in the US dollar and the euro, economists said Thursday at an Asian Development Bank meeting in the Philippines.
Iwan Azis, head of the Manila-based bank's Office of Regional Economic Integration, said the Chinese yuan was becoming very important as China's economy grows.
"It is just a matter of time, it's not a matter of yes or no, but a matter of time," he said when asked about the yuan becoming an international currency.
US economist Jeffrey Sachs said the global financial system would benefit from having more than one reserve currency in the system other than the US dollar.
"Ideally, we would like to see at least three or four reserve currencies and a flexible arrangement among them, and that would be the dollar, the euro, the yuan and the yen," he said.
But he noted that Europe must fix structural problems in its banking and financial systems to "get the euro once again as the new pillar of a multi-currency system."
"The euro is in shock right now ... and it is important that Europe fixes these structural problems," he said.
Sachs said he supports China's efforts to make the yuan an international currency: "Stronger regional monetary cooperation in Asia and a stronger role of the yuan are absolutely important for the function of the international system."
"China is correctly working hard now to make the yuan internationalized and that will help the international system as another pillar in the multi-currency system," he added.