The Chinese government has taken steps to promote the international use of its currency, the renminbi, which will diminish the dollar’s role in international trade, according to a report from the Brookings Institution.

The steps China has taken to internationalize the renminbi have been gaining traction and the currency now represents the fifth-most important payment currency in the world.

“The Chinese renminbi, barely visible in international trade of financial flows just three years ago, appears to be blossoming,” says William Wilson, a research fellow at the Heritage Foundation. “China is now the world’s largest trading nation, and more corporations, particularly in Asia, are beginning to invoice their business in [renminbi].”

Because of this rise, there is concern that the renminbi could displace the dollar as the world’s dominant currency. According to Brookings, as the renminbi becomes a prominent international currency, it will diminish the dollar’s role in international trade transactions.

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