They're illiquid, subject to government interference, and with no LIBOR-style reference source for pricing. So what's the appeal of non-convertible currencies?
In a word: China.
There's more trading in non-convertible emerging currencies than you might think. Last year's 2010 triennial central bank report estimated trading in RMB outside its home market at US$22bn (or, if you're thinking ahead to a post-dollar reserve, CNY144bn). A previous underestimate of Indian rupee trading in London and New York, as well as Singapore, delivered a surprise $17bn for that currency for the year.
A paper published in March by the Bank for International Settlements (BIS) on FX trading in emerging currencies pointed out that similar dollar amounts in currency turnovers belie "ratios that differ by an order of magnitude. Thus, the RMB trades less than China's trade and income would suggest, while the rupee trades more than India's trade and income would seem to warrant."