BEIJING, July 6 (Xinhua) — Monday marked a red-letter day for Renminbi(RMB) or yuan, since the first cross-border yuan trade settlement deal was transacted.
The deal marked a critical step for the yuan to become a world currency.
The Bank of China (BOC), China’s largest foreign exchange bank, announced Monday that it had consumated the first deal Monday morning.
China’s State Council announced in April a pilot program to allow exporters and importers in Shanghai, and southern Guangzhou, Shenzhen, Zhuhai and Dongguan cities to settle cross-border trade deals in yuan.
Amid the ongoing financial crisis, the new service is bound to help warm up international trade, further push the yuan around the globe and alleviate the world’s overreliance on the U.S. dollar.
Gao Feng, a scholar with Tsinghua University, told Xinhua that as an essential step toward the RMB’s internationalization, cross-border settlement is the result of China’s rapid growth. It will make it more convenient for exporters and importers to carry out trade and avoid the risk of exchange rate fluctuations.
