Exporters and importers would benefit greatly from using the yuan as a trading currency with their counterparts in China and elsewhere, economists from Standard Chartered Bank (China) said yesterday.
Thai exporters and importers could enjoy lower transaction costs, improved risk management, transparent pricing and investment flexibility, Zhu Leeza, head of cash-product management, told reporters in Bangkok.
Zhu and her colleagues are conducting a roadshow to teach business communities in Asean the benefits of using the yuan as a new trading currency.
The People's Bank of China - that country's central bank - last July issued tentative guidelines for yuan settlement with Hong Kong, Macau and Asean countries.
Zhu said the central bank did not require trading partners to use the yuan and that its popularity would depend on offshore market demand for it as a trading currency.
She predicted demand for the yuan would increase significantly as the yuan became increasingly liberalised.
Yuthadej Putamanonda, head of transaction banking at Standard Chartered Bank (Thailand), said yuan transactions were now very small compared with those in US dollars and euros.
"Thai business people are interested in using the yuan in international trade with their counterparts in China, but everyone wants someone else to do it first," he said.
Yuthadej said the Thai unit was granted a licence by Chinese authorities last year to conduct end-to-end cross-border yuan trade transactions.
Li Wei, an economist at the Chinese unit, predicted the yuan would appreciate 2 per cent against the US dollar this year.
China is under pressure from the United States and other countries to appreciate its currency.
Li said China's economic growth would slow a little this year, due to policy-tightening aimed at preventing the economy from overheating.
