Thoughts on RMB cross-border trade settlement
by Helen Sanders, Editor
Since July 2009, companies with locations across South East Asia have been able to settle cross-border trade transactions with eligible firms in China in RMB. Most of the major international banks operating in the region have been quick to acquire the necessary licence and processing capability to enable their customers to take advantage of this opportunity. But as we start the Chinese Year of the Tiger, with all its associations of power and courage, what is this project likely to mean for companies trading in China, both now and in the future, and are we likely to see the Chinese authorities forging ahead to achieve full RMB convertibility and creating a world currency of the future? In this article, we showcase the views of four key experts in this field on the project today and the future potential of the RMB.
Pilot project progress
Banks supporting their clients’ trade activities in China have generally been optimistic about the scheme and its implications for their clients. With only a few months since the scheme was launched, it is perhaps too early to gauge its success, and initial optimism has had to be tempered with realism. Chris Lewis, Head of Trade and Supply Chain - Greater China, HSBC, sees the expansion of the scheme since it was first launched as a significant indication of success,