Wider use of yuan by investors urged
The Bank of China is urging Thais to use yuan for their investment activities in China, instead of just for making payments, to cut down on foreign-exchange costs.
Pan Zhijian, assistant general manager of the Bangkok branch, said yesterday that after China allowed cross-border trade settlement in yuan and moved to internationalise its currency in 2009, the use of yuan offshore had seen a steady increase.
Thailand is an important economic and trade partner of China in Asean while China is Thailand’s second-largest trading partner behind Japan. China is also Thailand’s largest export market and second-largest source of production materials.
Having alternative financial structures will help investors diversify risks, Pan said.
The Bank of China yesterday joined with two local banks – Bangkok Bank and Kasikornbank – to offer a yuan clearing service for the customers of the two local banks.
When Chinese Premier Li Keqiang paid an official visit to Thailand this month, the two countries agreed to strengthen cooperation in finance and banking and encourage more use of local currencies for settlement in both trade and investment.
From the bank’s customer survey, demand for yuan clearing in the next five years is expected to expand to 20-30 per cent and 60 per cent of customers said they would increase the use of yuan in their transactions.
