Chinese, Czechs Discuss Setting Up Yuan Settlement Mechanism

Chinese, Czechs Discuss Setting Up Yuan Settlement Mechanism

Chen Juan

Date: Wed, 09/26/2018 - 23:34 / source:Yicai
Chinese, Czechs Discuss Setting Up Yuan Settlement Mechanism
Chinese, Czechs Discuss Setting Up Yuan Settlement Mechanism

(Yicai Global) Sept. 26 -- Bilateral trade between China and the Czech Republic has ballooned in recent years, but the two also seek to further cooperate in finance. They are therefore discussing the possibility of devising a settlement mechanism for China’s yuan in the latter, said Zhang Jianmin, China’s ambassador to the Eastern European Country.

Zhang made this statement at a forum of the China Europe International Business School in Shenzhen yesterday. 

China is the Czechs’ third-largest commercial partner, while the Czech Republic is China’s second-largest trade partner in Central and Eastern Europe. The trade volume between them makes up nearly 20 percent of that between China and the 16 countries in the region. 

Cross-border e-commerce and other new trade forms have emerged and developed to augment traditional varieties. Ever more Czechs buy Chinese goods online, with the average monthly number of deals now over 110,000, Zhang said.

This closely connected commerce also promotes the growth of finance. Bank of China and Industrial and Commercial Bank of China have set up branches in the Czech Republic, and Bank of Communications has also submitted files and materials to the Czech central bank to apply to do so.

The Czech capital Prague will gradually become the springboard for Chinese financial institutions’ entry into Central and Eastern Europe, Zhang added.

Zhang offered no further details about the settlement vehicle. 

Commercial banks from Germany, Singapore, Luxembourg, Pakistan and other countries now have mechanisms in place that enable their banks to conduct direct transactions in yuan as an approved foreign currency via accounts in local branches of Chinese banks, thus making the use and exchange of the currency more efficient and convenient.

Editor: Ben Armour

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Keywords: Yuan