It took several years of deliberation before the inclusion of China's renminbi in the SDR basket was approved by the International Monetary Fund board of directors. Among these were previous executive director of the International Monetary Fund and current World Bank executive director Otaviano Canuto.

"It's a win-win for China and the world. It's a first time a developing country makes it, manage to have its own currency as part of a basket. It's a acknowledgement of the fast-pace progress of the Chinese economy," said Otaviano Canuto.

The renminbi's global reserve status also means it will become the first emerging market currency that can be used to settle IMF credits and debts.

Canuto believes the move will have a profound impact.

He added that the inclusion of RMB into the SDR represents a recognition of China's progress in economic development as well as its financial reforms and opening up.

He says currency rates may fluctuate in the short-term but in the long term, he expects a stable and internationalised currency.