The development also hints at lack of confidence among investors in Americans political and economic system as well as capabilities of leaders.

"Such developments can be attributed to the flawed US policy of spend and borrow", President Pakistan Economy Watch (PEW), Dr. Murtaza Mughal said.

Unhealthy habit of spending more than income has transformed US from largest lender nation to the biggest debtor, he told.

The US government debt is set to exceed 70 per cent of GDP which will hurt its prestige, power and influence he said adding that otherwise the status of the dollar would have never been called into question.

A country needs to have stable political and economic system to have a stable currency, said Dr. Murtaza Mughal.

He stated that dependence on dollar has become increasingly dangerous while calls for another international reserve currency are yet to be translated into realty.

China is better placed to provide a reserve currency as it has largest reserves and Chinese enjoy a focused government and few economic worries as well as challenges, he suggested.

Dr. Mughal said that whole world is seeing the scale, resources and organizing capacity of Beijing, as China is already the worlds largest exporter, net creditor and by 2014 China's economy will pass the US, in absolute size, he informed.

World would be at ease in the Chinese dominance as they are not assertive and not very sensitive about their ranking in world system.

Beijing is not in habit to impose their ideology, political, economic and cultural influence on others therefore their dominance can be a good one for world's peace, he said