De-dollarization: IMF hints at allowing countries to use Chinese Yuan for debt repayment

The International Monetary Fund (IMF) has hinted that it may accept the Chinese Yuan as a currency for countries to settle their obligations with the IMF following Argentina’s recent debt repayment in yuan.

IMF spokesperson Julie Kozack confirmed that Argentina had paid off part of its debts — equivalent to $1.1 billion of the $2.7 billion that matured last month — with the IMF in Chinese currency.

“As we have stated in the past, the Argentine authorities continue to remain current on their financial obligations to the IMF,” Ms. Kozack said at a press briefing.

“The RMB is one of the five freely usable currencies that members can and have used to settle their obligations with the IMF,” she added, referring to the Chinese currency by its official name, the renminbi.

Argentina’s Central Bank said it had incorporated the yuan as a currency accepted for deposits in savings banks and checking accounts, signaling a departure from the U.S. dollar as its sole official reserve currency.

“Financial entities will thus be enabled to open bank accounts denominated in renminbi yuan,” the bank stated.

Aside from Argentina, Brazil also signed an agreement with China earlier this year that would allow them to conduct trade and investments in their own currencies, further reducing the U.S. dollar’s dominance.