"Emergence of new offshore Rmb hubs offer chance to foster closer collaboration"
Joe Ng, head of renminbi payments product management, Asia Pacific, Deutsche Bank, discusses financial regulators’ role in encouraging greater prevalence of the currency. December 03, 2013 | Esther TanThe likes of Taiwan, Singapore, and London - and more recently, Paris and Frankfurt - are amongst emerging financial hubs looking to increase renminbi-denominated product offerings, as each aspires to eventually rival Hong Kong as one of the world’s largest offshore renminbi hub. According to Hong Kong’s Financial Services Development Council, renminbi deposit growth in Hong Kong cooled in between December 2011 and September 2013, increasing a mere 24% to $120 billion, whereas other offshore renminbi deposit hubs experienced a near seven-fold growth over the same period. Are we witnessing a cannibalising act? Competition among offshore Rmb hubs Joe Ng, head of renminbi payments product management, Asia Pacific, Deutsche Bank, does not see the emergence of new offshore renminbi hubs as a threat to one another but, rather, a chance to foster greater collaboration to create a larger market for the renminbi. The main offshore renminbi centres such as Hong Kong, London, Taiwan and Singapore all possess a similar clearing mechanism, as they share the same offshore renminbi liquidity pool. According to Ng, “The emergence of different offshore centres is conducive for the development of offshore renminbi as it gives corporates more confidence to transact in the currency.” A corporate firm located in ASEAN can depend on Singapore’s renminbi clearing capabilities, while another in the UK can make use of London’s renminbi services. As SWIFT data (May 2013) indicates, 47 countries settled more than 10% of their payment transactions with China and Hong Kong in the renminbi, up from 31 countries (July 2012). This demonstrates a synergist effect among the various offshore renminbi hubs. Worldwide countries having payments with China/ Hong Kong Figure 1. The Rmb river Please login to read the complete article. If you already have an account, you can login now or subscribe/register. Categories: Payments, Rmb, Transaction BankingPayments,Rmb,Transaction Banking, Payments,Rmb,Transaction Banking, Keywords:Joe Ng, Deutsche Bank, Trade Settlement, Financial Services Development Council, PBoC, MAS >
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