By Ukumbi Afrika China has taken another step toward expanding the international use of the renminbi by authorising Standard Bank and the Industrial and Commercial Bank of China (ICBC) to provide yuan-clearing services across Africa.
The approval, granted by the People’s Bank of China, allows businesses and financial institutions in Africa to access China’s onshore financial markets and payment infrastructure more directly, making trade and investment transactions more efficient.
Operating jointly as the Renminbi Clearing Bank of Africa, the two institutions will support yuan clearing in 19 African countries. The move follows broader measures announced by Chinese authorities to encourage offshore use of the Chinese currency and reduce reliance on the U.S. dollar in international payments.
According to Standard Bank, demand for renminbi-based trade is expected to increase as commercial links between China and Africa continue to deepen. The bank also noted that Asian markets are becoming increasingly important trading partners for African businesses.
Source: Reuters. Reporting by Colleen Goko. Editing by Bate Felix and Philippa Fletcher.