The short answer: cheap exports. However, that comes at a cost of making it expensive for Chinese travelers on heading overseas especially with EU, UK or US since they will need to pay more to exchange Euro / Pound or US Dollars when converting directly from RMB, since the Yuan is not strong against those major currencies.
Despite China having the second largest economy, their own currency is still weak against GBP, EUR & USD. Even though China is cashless for the most part, they still print bank notes (which are shit value) when you convert them as it's basically "pocket change" (so Western travelers have higher purchasing power than the Chinese):
By contrast when you exchange GBP, EUR & USD for Yuan (RMB): you still receive more than in their currency than a Chinese traveler would when they exchange RMB directly for GBP, EUR & USD when they're in a Western nation:
It would mean for a Chinese traveler, they'll be spending A LOT more money in the West (expensive for them due to lower purchasing power) than the reverse to an American, Brit or European when it comes of as "China is so cheap" flex just because they possess currencies that are worth more at face value.
EDIT, disclaimer: I'm writing this using USD as a primary example, but it holds true for many other currencies as well.
Because it's not as freely traded as the USD. The main reason behind USD being so stable is because it's available "anywhere". And the reason for this is because it was always freely traded and easily bought by "anyone". This results in loads of countries having USD as a foreigner reserve. On top of this, US monetary policy (not to be confused with US economic policy) values stability over anything else, resulting in a sought after currency for long term holdings, thus increasing its price.
The Yuan could in theory serve as a world reserve currency as well, but faces some challenges:
This results in Yuan not being as attractive as the USD. Combine this with it being in the interest of the CCP to keep the currency somewhat low (because that's in the best interest of their export capacity), and you get a Yuan trading for significantly less than its potential.
I honestly don't see this changing any time soon. Having the Yuan as the de facto world default currency is simply not a priority for neither China nor other countries. And the ones who control its value have a vested interest in keeping it low.
It is worth noting that a "cheap" currency that can be bought for 1000 jimjams on the dollar doesn't make it a low value currency. The exchange rate itself does not determine value, only the price. Value of a currency is derived from (percieved) future prospects of the currency. If it's more or less certain that you can buy 1000 jimjams for one dollar, gbp, or euro 50 years from now, that makes the jimjams a valuable currency, even if the relative exchange rate is high.