April 24, 2009 / 9:19 PM / 9 years ago

UPDATE 1-G24 to study China proposal on new global currency

(Adds quotes, details)

By Lesley Wroughton

WASHINGTON, April 24 (Reuters) - China’s proposal to lessen global reliance on the U.S. dollar by expanding the use of Special Drawing Rights, the International Monetary Fund’s unit of account, is worth a closer look, the head of the Group of 24 nations said on Friday.

G24 chairman Adib Mayaleh, who is also the Syrian central bank governor, said the grouping of developed and developing countries that includes China has called on Beijing to provide more details of the proposal.

“It is a proposal that deserves to be studied and thoroughly examined,” Mayaleh told a news conference, speaking through a translator.

“There are many countries that have started seeking another currency than the dollar,” he said.

The G24 is a grouping of emerging and developing countries from Asia, Africa and Latin America. It is considered one of the few global forums that speak for the developing world and also includes also nations that are not part of the Group of 20.

China has provoked debate about the dollar’s status as the world’s main unit of exchange by suggesting last month that the SDR be more widely used as part of a sweeping overhaul of the global monetary system.

The SDR was created by the IMF in 1969 as the IMF’s unit of account, and its value based on a basket of currencies including the dollar, Japanese yen, British pound and euro. Some emerging market economies have suggested that basket of currencies be expanded.

China has argued that a super-sovereign reserve currency would eliminate the risks inherent in currencies such as the dollar and also make it possible to manage global liquidity.

The IMF has said the idea is worth discussing but has repeated that the dollar’s status is not under threat. (Reporting by Lesley Wroughton; Editing by Chizu Nomiyama)

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