UAE can become vital renminbi hub

HKMA says it has necessary infrastructure to do so.

Norman Chan, Chief Executive of Hong Kong Monetary Authority, believes the United Arab Emirates has huge potential to become a regional hub for the offshore renminbi trade..

“The UAE is a regional trade hub for the Middle East and North Africa region. The country has the necessary financial infrastructure to link up the entire region’s trade with China to the fast growing offshore RMB denominated trade and investments, “Chan said

To internationalize the renmimbi, China has begun trade settlements in RMB in a limited way using Hong Kong as the offshore renmimbi business centre. Currently more than 30% of Mainland China’s trade is intermediated through Hong Kong.

In 2012, some 60% of China’s foreign direct investments originated from or through Hong Kong and China’s overseas direct investments were made through Hong Kong.

HKMA is currently working with various international financial centres such as London and Singapore to function as regional hubs for offshore renminbi trade.