The renminbi’s presence continues to grow globally, with Taiwan adopting the currency for trade transactions at a rapid pace.
Excluding Hong Kong and China, Taiwan was at seventh position in August 2012 in terms of renminbi payments value out of 131 countries engaged in similar transactions, according to Swift’s RMB Tracker. This is up from 57th place in July 2011.
The weight of the renminbi payments done by Taiwan now represents 24% of the total payments value with China and Hong Kong, compared to 9% in January 2012.
The increasing use of the Chinese currency could be further aided by the recent development in August when the People's Bank of China (PBoC) and the Central Bank of Taiwan signed a currency clearing memorandum of understanding (Mou). This includes the intention to appoint a renminbi settlement bank in Taiwan.
“[The signing of the Mou] may further drive adoption of the renminbi by Taiwan, already using the renminbi for nearly 24% of all its payments by value according to Swift’s Business Intelligence statistics,” said Lisa O’Connor, initiative director for RMB internationalisation at Swift.
Taiwan has experienced a steady growth in volumes since it began using Chinese currency in July 2011, with renminbi payments value growing by four times in the last 8 months. The nation’s renminbi payments' value increased 35.4% between July and August 2012.
Overall, renminbi usage worldwide grew 15.6%between July 2012 and August 2012, compared to an average decrease of 0.9% across all currencies, highlights Swift.
For the second consecutive month, the Chinese currency moved up one position and is now the fourteenth most used currency for payments with a market share of 0.53%, versus 0.45% in July 2012. It has overtaken the Danish krone at 0.47% but is a long way behind the Russian rouble at 0.63%.