Nation viewed as key player in reformed global structure

He would like to see an Asian Monetary Fund set up, with headquarters in Shanghai, which would reflect where the global financial system's center of gravity is shifting.

"The world needs a new reset and a monetary system that is based on fair play and equality. All countries should be invited to join the new monetary fund, not just Asian ones," he said.

Saeed believes that existing institutions will fail to help countries that become overburdened with debt as a result of the pandemic.

Citing the examples of Greece, Italy and Iran in the recent past, he said, "In all these cases neither the World Bank nor the IMF came forward to bail them out or give them support such as help with financial and structural reforms, a liquidity stress bailout or debt relief package."

Can China fill this void in the financial system and can the yuan act as an alternative reserve currency?

The Chinese government is intent on liberalizing its financial markets to make them attractive destinations for foreign capital, although this would rely on fewer capital controls and the yuan being more convertible than it is now.

Such a move is likely to gain momentum because China is facing twin pressures－increased domestic consumption and weak demand for its exports are set to turn the country's trade surplus into a deficit. It could also face a decline in domestic savings. Without these savings, it will need external capital to fund any trade deficit.

Zhu Ning, deputy dean and professor of finance at the Shanghai Advanced Institute of Finance, believes a major reform of the financial system, with the yuan playing a greater role, could suit China.

"To achieve that, China has to work harder on reforming its domestic interest rate liberalization and internationalization of the yuan," he said.

"There is increasing demand for reform of the global monetary system, and the yuan is clearly one potential candidate to diversify the pool of global reserve currencies."