Chinese Views of the International Monetary System and the SDR
by Barry Eichengreen
This project will attempt to reconstruct China’s international financial objectives by placing them in their historical context. It will use the history of China’s interventions in the deliberations of the IMF executive board to trace the evolution of the country’s positions on the international financial architecture. The principal materials (the main data) used as input to the analysis will be the transcripts of the deliberations of the IMF board, which are available in the IMF archives for the period since the creation of the SDR in 1970. The plan is to go through these transcripts and extract the intervention of the Chinese executive director as the basis for tracing changes in the country’s views over time. Questions will include the following:
1. When did China first begin to engage in any discussion about the SDR at the IMF? What was the country’s learning process?
2. How has China’s understanding of the SDR evolved (e.g. as liquidity instrument, development tool, alternative to a dollar-based currency system)?
3. How have the frequency and extent of Chinese interventions on SDR related issues changed quantitatively (can their extent be traced using count data)?
4. How should China’s position vis-à-vis the US, Europe and other developing countries be characterized? What specifically has been China’s position on a range of SDR-specific questions (allocation, basket composition, etc. in different time periods)?
5. Has China’s position on inclusion of the RMB in the SDR basket changed over time? When did this first become a priority of Chinese policy?
6. What are China’s views, positive or negative, about the emergence of a multiple international currency (“multi-polar”) international monetary system?
7. What do the answers imply for whether China is likely to work through multilateral institutions like the IMF or regional constructs like its newly created Asia Infrastructure investment Bank?