JNN 21 Nov 2012 Beijing : China’s official currency yuan is set to rise to the status of an international currency as more nations abandon the US dollar to peg their currency to the Chinese yuan, a new report says.

The latest research by the Peterson Institute for International Economics (PIIE) shows that renminbi (the official currency of China whose primary unit is the yuan) will become internationalized in 10 to 15 years if China further liberalizes its financial market.

Also on Monday, the Royal Bank of Scotland predicted that renminbi will become a fully convertible currency in 2015.

According to the PIIE report, seven major East Asian economies, including South Korea, Indonesia, Malaysia, Singapore and Thailand have formed a new “renminbi bloc” and track the renminbi more closely than the US dollar.

China has turned into the main trading partner of the East Asian countries, with its share in the regional states’ manufacturing trade rising from two percent in 1991 to nearly 22 percent in 2012, the PIIE says.

The renminbi is also gaining an extra-regional momentum, as the currencies of India, Chile, Israel, South Africa, and Turkey are tracking the Chinese currency more closely and even sometimes closer than the dollar, the research added.

Financial analysts contend that while both the dollar and euro are under pressure of the international financial crisis, more customers are starting to practice in renminbi as they view China as the future hub of global economic growth.

The rise of renminbi’s global sway comes as China has become the world’s second economy since last year.

Earlier in November, the Organization for Economic Co-operation and Development predicted that China’s economy would overtake the economies of the entire eurozone by the end of 2012 and it will become the world’s No. 1 economy by 2016.