Argentina's Central Bank President Martin Redrado said on Monday that his country supports China's proposal on creating an alternative global reserve currency to replace the U.S. dollar.

"We have been talking (with China) that we clearly need to seek alternative currencies because our world is becoming more multilateral," Redrado told Xinhua on the sidelines of the Inter-American Development Bank (IDB) governors assembly.

"Clearly the dollar has suffered an important punch and alternatives are needed," Redrado said.

"Argentina will work with China in the framework of the G20 and in other multilateral forums to seek this kind of alternatives," Redrado said.

Venezuela's Finance Minister Ali Rodriguez told Xinhua that it is necessary to create a new currency for international settlements, considering the weakening dollar and uncertainties of the U.S. economy.

A new international currency will facilitate trade amid the current situation, said Rodriguez, noting that Brazil and Argentina already use local currencies in bilateral trade.

The dollar's dominant status has been increasingly challenged amid the current global financial crisis.

Seven countries including Venezuela, Cuba, Bolivia and Honduras, Nicaragua and Dominica, are seeking to create a common currency named the Sucre, Rodriguez noted.

Zhou Xiaochuan, China's central bank governor, said in an article published last week that a new super-sovereign reserve currency should replace national reserve currencies as the backbone of the global monetary system.

He argued that a new global reserve currency, based on a basket of major currencies and managed by a multilateral organization like the IMF, would transcend the national interest of reserve currency printing countries and contribute to the stability of the international financial system and the development of world economy.

John Lipsky, IMF's first deputy managing director, has called Zhou's idea a "serious proposal."

Source: Xinhua