WIDER ACCEPTANCE OF RENMINBI CAN HASTEN ASIAN ECONOMIC INTEGRATION

KUALA LUMPUR, March 6 (Bernama) -- The wider acceptance of the Chinese
renminbi can accelerate the integration of Asian economies, an economist with
Citigroup, said here Saturday.

Shen Minggao, chief economist for Greater China at Citigroup Inc, said
China's renminbi could become one of the world's top five currencies by 2020.

He said China's (massive) economic scale already met the criterion of an
international currency.

Renminbi or the Yuan, which is hovering at 6.83 to the U.S. dollar
currently, is forecast to appreciate to 6.62 by the end of the year and 6.55 by
March next year.

"We expect a de-peg to happen in the first quarter of this year but due to
rising political tensions pertaining to the United States, we expect the
appreciation process (only) by the middle of the year," Shen said.

"The RMB could be hostage to political and financial conditions in the near
term, if only partially from the U.S. dollar this year," he said at a briefing
at the Citigold Wealth Management Leadership series here Saturday.

Chinese currency authorities reportedly said Saturday that Beijing was
pushing for the Yuan to be added to the basket of currencies that comprises the
International Monetary Fund (IMF)'s special drawing rights.

It was aiming for inclusion in 2015.

The SDR's value is based on a basket of four key international currencies,
currently the euro, yen, sterling and the dollar.

The basket composition is reviewed every five years, with the next review
coming up in late 2010.

Shen also said that China was expecting gross domestic product to be around
10 percent this year driven by investment and domestic consumption from 8.7
percent last year.

While seemingly mild given the extent of China's monetary stimulus over the
past year, the higher inflationary expectations are likely to worry those
already concerned about the possibility of economic overheating, he said.

"At the moment, we expect there will not be further tightening in the near
term, unless inflation picks up unexpectedly," he said.

He also said that the future of the global economy will depend on emerging
markets as countries around the world gradually exit the protracted financial
crisis.

Sheno said China was expecting a 20 per cent export growth in the first
half of this year.

"This will allow some room for flexibility for policy makers to move the
currency," he said.

China has become the world's third largest economy, depending mainly on
agriculture, industry, services and exports.

Today, the country is one of the largest producers of grains, cotton, oil
plants, fruits, meat, eggs, aquatic products and vegetables, and is also known
for its toys and electronics exports.
-- BERNAMA