China

The first offshore RMB bond to be issued, listed and cleared in Paris launched on Tuesday and France is set to have its own RMB clearing bank soon. The city’s strengths in areas such as trade with Africa and eurozone bond issuance might give it an edge in the rising competition among European capitals to become the leading RMB hub.

Russia and its companies are looking east, as conflicts and sanctions sour relationships with the West. The result could be a big boost for China's drive to internationalise the renminbi, as Russia looks to reduce its dependence on the dollar and China seeks the long term goal of establishing a rival global reserve currency. Trade and infrastructure finance will be hot areas, and could be boosted with the emergence of a new China-led development bank.

Bank of China (BoC) has opened books for its Paris debut of renminbi-denominated bonds. BoC’s Paris branch will be the issuer and the two and five year dual-tranche deal has been indicated at 3.6% area and 4.0% area, respectively.

The China Securities Regulatory Commission published a draft rules related to delisting on July 4 as it looks to strengthen a regime that it has described as “vague and incomplete”.

IL&FS Transportation Networks (ITNL) will be meeting investors for what could be the first offshore renminbi bond from an Indian borrower in nearly a year.

Jinchuan Group is meeting investors for its debut international offering. The deal will mark the first offshore renminbi bond issued by a regional state-owned enterprise (SOEs) that has gained approval from China’s National Development and Reform Commission (NDRC).

South Korea has become the first offshore renminbi hub in North Asia outside Greater China, after the People’s Bank of China (PBoC) and the Bank of Korea (BoK) signed a July 3 memorandum of understanding (MoU) on RMB clearing arrangements in Seoul and named Bank of Communications Seoul Branch as the country's renminbi clearing bank.

In this round-up, China launches direct RMB/KRW trading, an MoU is signed planning a clearing bank in Seoul, South Korea receives its first Rmb80bn RQFII quota, Safe removes the FX trading spread limit on CNY/USD, and Alipay and two Chinese banks open Luxembourg branches.

The Swiss Banking Association (SBA) is expecting the establishment of a currency swap line between the Swiss National Bank (SNB) and China’s central bank in a few months, with a renminbi clearing bank appointment to follow.

The Association of the Luxembourg Fund Industry (ALFI) and the Asset Management Association of China (AMAC) on July 2 signed a memorandum of understanding (MoU) focusing on developing activities to create mutually beneficial opportunities for the fund industries in both countries.

The latest reduction in from 190 to 139 restricted investment areas in the Shanghai pilot Free Trade Zone (FTZ), from 190 to 139, opens up opportunities in real estate, entertainment, and healthcare. But critics say the list is still too far-reaching.

Renminbi internationalisation in Europe took another step forward on Sunday when the People’s Bank of China (PBoC) signed memoranda of understanding (MoUs) for RMB clearing arrangements with the central banks of Luxembourg and France, paving the way for official RMB clearing banks to be appointed for each country.