China’s central bank is continuing its ambitious drive for the renminbi (Rmb) to become an international currency by expanding its plan for using the currency in cross-border trade.

The People’s Bank of China (PBOC) will introduce a trial period to more regions this year, allowing the tightly-controlled currency to be used to settle trade transactions.

The scheme currently covers 20 of China’s 27 province-level administration regions, including Beijing, Shanghai, Shandong and Sichuan.

PBOC is planning on rolling out the initiative across all of China.

“The PBOC aims to expand its pilot plan nationwide this year and introduce a trial project for cross-border renminbi settlement,” confirmed Li Bo, director of the central bank’s monetary policy bureau.

The take-up of Rmb-denominated trade has increased significantly during 2011.

The PBOC aims to expand its pilot plan nationwide this year.”

According to official figures from the Chinese government, total cross-border Rmb transactions reached ¥506.3bn (US$77.7bn) throughout 2010.

Transactions for the first quarter of 2011 have already reached ¥360.3bn (US$55.3bn).

“The objective of cross-border renminbi trade settlement is to make trading and investing easier and change the currency into a feasible market option through the introduction of supporting policies,” Li adds.

The bank has pledged to continue to promote off-shore Rmb trade and to open up the domestic financial market to allow more foreign banks to enter China’s interbank market.

Furthermore, PBOC has stated that it will sign currency swap deals with more countries to encourage currency cooperation and promote bilateral trade.