China adopted the Pinyin system in 1958 as the system for representation of pronunciation tone for Putonghua, which is Mandarin. Prior to this, Mandarin pronunciation symbols were represented by Zhuyin symbols (also known as Bopomofo). The Pinyin system replaces these symbols with Latin alphabets to make the teaching and learning of Mandarin easier as a student of Chinese language need not remember a set of Zhuyin symbols to learn the pronunciation of Mandarin.
From 1978 onwards, in places like Singapore and Malaysia, institutions teaching the Chinese language started to adopt the Pinyin symbol to replace the Zhuyin symbols in learning Mandarin.
In 1979, the USA Library of Congress decided to adopt Pinyin for romanization of Chinese names of people and places in China, replacing the Wade-Giles system that has been in used since early 20th century CE. The Library of Congress stated that this is because of pinyin’s demonstrable superiority to Wade-Giles for online retrieval and its widespread trend. Since Pinyin already uses Latin alphabet, this makes it’s easier for international bodies to adopt it as a system of romanization of Chinese terms and names based on Mandarin pronunciation.
In 1982, the use of pinyin as the standard for romanization of Chinese was published by International Standard Organization as ISO 7098.
The difference between Pinyin and Wade-Giles is as follow:
Pinyin is a system for learning of Mandarin that uses Latin Alphabets to replace the traditional Zhuyin symbols (the Zhuyin symbols are still used in Taiwan for learning of Mandarin). Because pinyin uses Latin alphabet, it has also been adopted by international bodies as the system for romanization of Chinese names, words and terms, based on the Mandarin pronunciation of these words.
Wade-Giles was the system used for romanization of Chinese names, words and terms before the Pinyin system was developed. The Wade-Giles system is not as systematic and coherent as pinyin as the romanization of Chinese words can be based on Mandarin, Cantonese, Hokkien or any other Chinese languages based on who did the romanization. In contrast, pinyin is based on Mandarin only, making standardization in the age of Internet easier.
As an example, the romanization for the name of the province of 广东 is:
Pinyin – Guangdong
Wade-Giles – Kuang-tung
For 广西 is:
Pinyin -Guangxi
Wade-Giles – Kuang-Hsi