China’s renminbi will have to appreciate by 7 to 8 percent if the government is to achieve its goal of doubling the country’s gross domestic product from its 2010 level by 2020, former World Bank senior vice president Justin Lin Yifu (林毅夫) said.
Lin, who also served as the World Bank’s chief economist, said achieving the goal requires an annual economic growth of over 6.5 percent, which must be supported by an expansion in labor productivity of more than 6 percent a year, or 4 percentage points above the current level in developed countries, the Hong Kong Economic Joournal reported.
It takes a stronger renminbi for such a growth rate to be achieved, Lin said, adding that the country still has room to lower its lenders’ reserve requirement ratio to boost the economy.
Meanwhile, the Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung said the pace of renminbi internationalization is expected to speed up amid growing demand for assets denominated in the Chinese currency.
Chan called on Hong Kong to further enhance its renminbi clearing operations as well as other offshore renminbi products and services.
Financial Secretary John Tsang Chun-wah said he expects the renminbi will soon be included in the International Monetary Fund’s Special Drawing Rights basket as the importance of the Chinese currency continues to rise globally.
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