Yuan Against Dollar: China's New Currency Strategy in the World of Tariff Wars.

China is actively promoting its currency - the yuan, in international settlements. It is leveraging the uncertainty and problems arising in global trade due to the aggressive tariffs from the USA.

During President Xi Jinping's visit to Southeast Asia, where he sought to strengthen ties ahead of the increase in American tariffs, the People's Bank of China actively supported the expansion of yuan as an international currency.

The use of yuan in cross-border payments reached a record level in March. Analysts note the growing interest in the Chinese currency due to aggressive US tariffs that undermined confidence in the dollar and other American assets.

Additionally, the Chinese financial company China UnionPay has expanded its payment network in Vietnam and Cambodia. The central bank of China has announced measures that will facilitate cross-border settlements in yuan.

The QR code-based payment network created by UnionPay for Southeast Asian countries will ease transactions for tourists and small businesses, reducing dependence on the dollar. This network is already operational in over 30 countries.

The People's Bank of China has also expanded swap lines with other central banks, reaching a record 4.3 trillion yuan in February. The use of digital yuan in cross-border commodity transactions and in setting prices for oil and gold has also increased.

'The US, using tariffs as a weapon, has undermined trust in the security of American assets and the dollar, and shaken the global status of the dollar,' said E. Yunjian, a representative from the Bank of Communications.

Despite China's ambitions, the yuan currently cannot compete directly with the dollar, which accounts for nearly half of global payments. The Chinese currency ranks fourth with a share of only 4%. Some believe that distrust in the dollar will lead to an increase in the use of other currencies, especially the euro, before the yuan.

'The global monetary market system, governed by the US, is becoming increasingly fragile,' noted Professor Tu Yunxun from the Renmin University of China.

Thus, China is managing to enhance the use of the yuan as an international currency. Nevertheless, the dollar still remains the most popular currency in the world, yet its global status could be threatened, especially from emerging currencies such as the yuan.