China agreed to $12.8bn of deals with the UK during the British prime minister’s state visit, RMB returns as the fifth most used global payments currency, and Aberdeen Asset Management grabs Rmb5.3bn ($842.8m) new renminbi qualified foreign institutional investor (RQFII) quotas.
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- Theresa May, the UK prime minister, lined up £9bn ($12.8bn) of trade deals on her state visit to China this week, according to the British government.
One of these deals was signed between China Development Bank and Standard Chartered, according to a February 1 press release by StanChart. The two parties inked a memorandum of understanding (MoU), committing the Chinese policy bank to Rmb10bn of loans to StanChart over the next five years. The London-based bank will use this facility to support loans that will fund corporate finance projects and trade finance transactions in Belt and Road countries.
The move could boost the level of RMB financing for the Belt and Road Initiative, said Bill Winters, group chief executive of StanChart.
“This MoU brings us closer together, and offers more flexibility of funding, especially RMB funding, to support projects along the Belt and Road Initiative routes,” he said.
- May also announced the launch of an FX service initiated by R5, the FX platform provider, and Shanghai Clearing House, which allows domestic banks in China to access the London FX market. It currently has eight Chinese banks as participants, according to a February 2 press release by R5.
The new platform will not only help Chinese banks access the liquid London FX market and will also promote the usage of the renminbi outside China, said Jon Vollemaere, CEO of R5.
- The RMB was the fifth most used global payments currency in December 2017, up one place from November, according to Swift’s RMB tracker. The currency made up 1.61% of all global payments in the month.
Hong Kong remained the largest offshore RMB clearing centre, with 75.68% of RMB clearing outside Mainland China taking place in the city last December, up from 74.05% in the previous month. It was followed by the United Kingdom and Singapore, which took 5.59% and 4.41% of all offshore RMB clearing in December, respectively.