Financial institutions of Korea, China push for direct won-yuan trading
Financial institutions in Korea and China
are wasting no time taking the necessary steps to create a direct won-yuan trading market,…
one of the major agreements reached on economic cooperation last week, during summit talks
between the two countries’ leaders. The establishment of this market comes amid
the exponential increase in the use of the Chinese currency in global trading and payment.
Laah Hyun-kyung reports. One of Korea’s biggest financial firms Woori
Bank is expected to be in charge of promoting sales and marketing for the Korean branch
of China’s Bank of Communications. The head of the Bank of Communications, which
was appointed as the Chinese yuan clearing bank in Seoul just last week,… predicts
the amount of transactions settled in yuan by Korean businesses will nearly quadruple
to 300-billion yuan, or roughly 48-billion U.S. dollars a year in the near future.
Analysts say this falls in line with China’s push for increasing the use of renminbi by
banks and businesses in international transactions. The Hyundai Research Institute says… China’s
currency is increasingly preferred to the Japanese yen in global trade,… thanks to
its large economic scale and stability. The Korea Institute of Finance also says…
as of October last year,… the amount of global trade financing settled in Chinese
yuan stood at nearly 9 percent,… outpacing the Euro and the yen… and points out that
the rate of the yuan’s internationalization is 48 times faster than the yen’s in the 1980s.
In Korea expectations are high that President Park Geun-hye and Chinese leader Xi Jinping’s
agreement last week to soon let the two countries’ businessmen settle their trade bills in their
own currencies… will encourage more direct won-yuan trading.
However, some experts also warn the growing presence of the yuan will deepen Seoul’s economic
dependence on Beijing… though, it could help ease pressure on the Korean won’s appreciation
against the dollar. Laah Hyun-kyung, Arirang News.