China faces 'risks' as renminbi becomes international currency, says central bank chief

China faces an uphill battle against financial risks in the next five years as it gradually opens up its capital account and makes the renminbi an international currency, the central bank governor said.

Zhou Xiaochuan did not detail the risks faced, but said structural conflicts and institutional problems have surfaced and the fate of financial reforms would depend on the nation’s financial security.

“To guard against and eliminating financial risks is a severe challenge for us in the next five years,” the Governor of the People’s Bank of China wrote in an article.

READ MORE: Yuan currency on track for inclusion in IMF's reserves basket'

His comments were in a publication in which government department chiefs and provincial leaders discussed the country’s next five-year plan.

He said tools should be used and developed to manage financial risks, lower leverage ratios and prevent systemic financial risks.

China wants to smoothly introduce yuan convertibility under the capital account and expand the use of the renminbi at international financial hubs and in developed countries, the article said.