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Renminbi (元) growing in Africa
Community Coordinator

Chinese Yuan.jpgThe renminbi, literally meaning the "people's currency"; is the official currency of the People's Republic of China. Since Chinese authorities started developing the renminbi as a currency of international trade, it has been growing in circulation in global markets.


In 2015 total trade between Africa and China reached USD149.8bn, up from USD28.8bn ten years earlier. The rise of China as a global economic power has transformed Africa. The most convincing evidence of this is in the trade figures. Future Chinese-African economic relations will see Africa leverage the renminbi as a global reserve and trading currency.

Standard Bank is already a dominant foreign currency player in Africa, currently conducting 2.1 million trades annually. Our partnership with the Industrial and Commercial Bank of China (ICBC), China’s largest bank, is critical to the future of both Africa and China, especially since we are able to support Chinese trade and investment into Africa in renminbi.

 As Africa’s role in internationalising the renminbi deepens, we see the renminbi to likely emerge as a global reserve currency, eventually even becoming a globally accepted commodity denominator.


 Here are some benefits of operating in renminbi for Chinese businesses dealing with Africa:


  • Allowing Chinese clients to use renminbi as their base currency will realise significant savings.
  • Renminbi promotes price transparency and reduces the cost of international trade for Chinese clients. This will also provide Africa access to a wider range of Chinese suppliers.
  • Invoicing clients in renminbi, a cheaper currency than the US dollar, is not only easier for Chinese clients, but since the value of the renminbi more closely matches domestic African currencies conversion and volatility costs are reduced.
  • Since Chinese clients plan and earn in renminbi, operating in renminbi provides a great deal of security, removing many of the risks that Chinese businesses often associate with Africa’s multi-currency US dollar denominated landscape.
  • Our renminbi capability provides Chinese retail treasurers with simple and economically viable renminbi solutions. This frees them to concentrate on the competition, market challenges, and detail of importing and exporting, without worrying about US dollar conversion rates, currency fluctuation or liquidity risks.
  • Our partnership with ICBC assists in providing the financial infrastructure to manage Chinese industrial investment into the continent.

As China intensifies its renminbi internationalisation strategy and capital account liberalisation, the renminbi’s use as a global trade currency can only increase.


This will see the renminbi increasingly denominate Chinese trade finance deals and see investments structured in renminbi, from inception to deployment, as the renminbi emerges as a global reserve currency.   


Visit our Corporate and Investment Banking page for more details about our Foreign Exchange offerings.