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EWC Insights: Asia-Pacific Transitions series EWC Insights: Asia-Pacific Transitions series
EWC Insights featuring Christopher McNally EWC Insights featuring Christopher McNally
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The Digital Yuan, US Dollar Dominance, and the Future of Money

featuring 
Dr. Christopher McNally 
Adjunct Senior Fellow, East-West Center 
Professor of Political Economy, Chaminade University

Over the past four decades, China has been in a subordinated position within the International Monetary System (IMS) dominated by the US Dollar. Although attempts have been made to internationalize the Chinese currency, the renminbi or yuan, these efforts have made limited headway due to China’s close management of its capital account. The extensive and extraordinary financial sanctions levied against Russia by the West in early 2022, however, are likely to change the Chinese calculus regarding yuan internationalization. 

At the center of recent initiatives by the People’s Bank of China (PBoC) stands the launch of a central bank digital currency (CBDC), the digital yuan or e-CNY. This fintech innovation could potentially revolutionize monetary relations in China, since the e-CNY offers digital traceability, delivering unprecedented insight into the economy and potentially generating new tools for monetary management, including currency internationalization. While the future of the digital yuan is still murky, it forms part of a long-term evolution of China’s financial system that combines aspects of market-based finance with efforts to enhance state capacity, charting a new course beyond liberal convergence to establish novel tools of financial statecraft. 

 
Dr. Christopher A. McNally  is a Professor of Political Economy at Chaminade University and Adjunct Senior Fellow at the East-West Center in Honolulu, USA. His research focuses on comparative capitalisms, especially the nature and logic of Sino-Capitalism. He is at present working on a research project that studies the implications of China’s international reemergence on the global order. 

He has held fellowships conducting fieldwork and research at the Asia Research Centre in West Australia, the Institute of Asia Pacific Studies at the Chinese University of Hong Kong, and at the Shanghai Academy of Social Sciences. He has edited four volumes, including an examination of China’s political economy: China’s Emergent Political Economy – Capitalism in the Dragon’s Lair (Routledge, 2008). He also has authored numerous book chapters, policy analyses, editorials, and articles in journals such as Review of International Political Economy, Business and Politics, Communist and Post-Communist Studies, International Politics, and World Politics

Dr. McNally earned his Ph.D. and M.A. from the University of Washington and his B.A. from the University of California at Berkeley. 

The Digital Yuan, US Dollar Dominance, and the Future of Money

featuring 
Dr. Christopher McNally 
Adjunct Senior Fellow, East-West Center 
Professor of Political Economy, Chaminade University

Over the past four decades, China has been in a subordinated position within the International Monetary System (IMS) dominated by the US Dollar. Although attempts have been made to internationalize the Chinese currency, the renminbi or yuan, these efforts have made limited headway due to China’s close management of its capital account. The extensive and extraordinary financial sanctions levied against Russia by the West in early 2022, however, are likely to change the Chinese calculus regarding yuan internationalization. 

At the center of recent initiatives by the People’s Bank of China (PBoC) stands the launch of a central bank digital currency (CBDC), the digital yuan or e-CNY. This fintech innovation could potentially revolutionize monetary relations in China, since the e-CNY offers digital traceability, delivering unprecedented insight into the economy and potentially generating new tools for monetary management, including currency internationalization. While the future of the digital yuan is still murky, it forms part of a long-term evolution of China’s financial system that combines aspects of market-based finance with efforts to enhance state capacity, charting a new course beyond liberal convergence to establish novel tools of financial statecraft. 

 
Dr. Christopher A. McNally  is a Professor of Political Economy at Chaminade University and Adjunct Senior Fellow at the East-West Center in Honolulu, USA. His research focuses on comparative capitalisms, especially the nature and logic of Sino-Capitalism. He is at present working on a research project that studies the implications of China’s international reemergence on the global order. 

He has held fellowships conducting fieldwork and research at the Asia Research Centre in West Australia, the Institute of Asia Pacific Studies at the Chinese University of Hong Kong, and at the Shanghai Academy of Social Sciences. He has edited four volumes, including an examination of China’s political economy: China’s Emergent Political Economy – Capitalism in the Dragon’s Lair (Routledge, 2008). He also has authored numerous book chapters, policy analyses, editorials, and articles in journals such as Review of International Political Economy, Business and Politics, Communist and Post-Communist Studies, International Politics, and World Politics

Dr. McNally earned his Ph.D. and M.A. from the University of Washington and his B.A. from the University of California at Berkeley.