As the world’s second-largest economy, China has become both a participant in and a critic of the dollar-dominated global order. Its policy agenda includes expanding the global use of the renminbi, establishing currency swap lines with over 40 countries, and promoting platforms like the Cross-Border Interbank Payment System (CIPS) as alternatives to Western-led systems.

Despite these efforts, China’s progress has been mixed. The renminbi still accounts for only a small share of global foreign exchange reserves and cross-border transactions, and structural barriers, such as capital account restrictions, limit its international appeal. Nevertheless, China's growing economic weight, strategic investments, and political positioning are reshaping debates about the future of the international financial system.

This paper overall explores the motivations behind China’s approach to global finance, the mixed results of implementation so far, and the broader implications for global liquidity, financial stability, and the West’s capacity for economic leverage. It situates China’s strategy within the wider debate on international financial architecture reform and the emergence of a more multipolar financial order.

Report by the Overseas Development Institute