China China is building a yuan currency reserve to compete with the dollar and prop up other economies facing volatility

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China

China is building a yuan currency reserve to compete with the dollar and prop up other economies facing volatility​

PHIL ROSEN

June 27, 2022 4:27 PM

The People's Bank of China announced it is developing a yuan reserve with five other nations.

62b9bda89f5e550019aabe38


Five nations including Hong Kong and Singapore will contribute 15 billion yuan, or about $2.2 billion.In May, China's foreign exchange reserves, the world's largest, grew for the first time in 2022.

The People's Bank of China is building a yuan reserve with five other nations in collaboration with the Bank for International Settlements.

China is teaming up with Indonesia, Malaysia, Hong Kong, Singapore, and Chile to each contribute 15 billion yuan about $2.2 billion to a Renminbi Liquidity Arrangement, China's central bank said in a Saturday statement. "When in need of liquidity, participating central banks would not only be able to draw down on their contributions, but would also gain access to additional funding through a collateralised liquidity window," the bank said.

Per the report, the funds will be stored with the Bank for International Settlements.

The announcement follows Russia and China's endeavor to develop a new reserve currency with other BRICS countries, President Vladimir Putin announced last week.

The basket of currencies would present a US-dominated IMF alternative, and include contributions from Brazil, Russia, India, China, and South Africa.

"The matter of creating the international reserve currency based on the basket of currencies of our countries is under review," Putin told the BRICS Business Forum on Wednesday, according to a TASS report. "We are ready to openly work with all fair partners."

Meanwhile, last month, China's foreign exchange reserves the world's largest grew for the first time in 2022, state data shows. The nation's reserves rose by $80.6 billion to reach $3.13 trillion.
At the same time, the US dollar has hit a 20-year high in recent weeks.

And, in March, reports emerged of a Saudi oil deal priced in the yuan. An economist told Insider that a deal done without dollars could signal unease in relying too heavily on the US currency.

"While any deal would be symbolic, the Chinese are not alone in the search for a non-dollar reserve currency," Aleksandar Tomic told Insider previously. "Other countries' need for dollars exposes them to the US financial sector, and consequently gives the US political leverage."

 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
Too many US sanctions force other countries to scramble to look for alternatives, what US is doing is shooting itself in the foot.
 

Mehmed Ali

Committed member
Messages
279
Reactions
625
Nation of residence
England(UK)
Nation of origin
Bosnia & Herzegovina
You are such good guys, why didn't you prop up your brotherly anti American North Korea while the were dieing of hunger? Difficult to spare a bag of rice for your fellow anti .Americans? Anyway we have seen Imperialists do just that so many times. Prop some countries? You don't want to spare a dime as tip in restaurant
 

Jagdflieger

Contributor
Messages
504
Reactions
279
Nation of residence
China
Nation of origin
Germany
That would be great news for all, especially for Indonesia - that has no other way to recover economically due to a total currency manipulation by the US$ since 1997/8. The next step will be the decoupling from the US$ and it's controlled world spot market prices and currency echange rates.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
You are such good guys, why didn't you prop up your brotherly anti American North Korea while the were dieing of hunger? Difficult to spare a bag of rice for your fellow anti .Americans? Anyway we have seen Imperialists do just that so many times. Prop some countries? You don't want to spare a dime as tip in restaurant
North Koreans listen to no one, China tried to encourage them to open up since 1990's but they wouldn't listen. unlike US, China doesn't control any countries, we are friends on equal terms.

China is Losing control of North korea? see how Chinese senior diplamt Fuying, an ethnic Mongol, replied to this question raised by a western journalist.

 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
This is not an answer on my question. The question was very simple, shall I repeat it? Why didn't you give a bag of rice to your friendly camarade in arms? Simple question really
Where did you hear this joke?


China sent 240,074 tonnes of food aid in 2012 - more than 80 times the amount the European Commission gave North Korea that year - according to the UN.
In 2016, Beijing announced it was providing $3m in humanitarian aid to flood-hit North Korea after international agencies failed to raise sufficient funds.

A report to US Congress in 2014 said: "China, currently believed to be North Korea's largest source of food aid, has no known monitoring systems in place."
Other nations offer humanitarian support to North Korea through UN agencies, NGOs and the International Red Cross.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
I know I know those citizens points must be earned and for example you can be proud that city of bologna Italy following the suit of ever wise esteemed leadership of benevolent China. You see I am not only about critique here I can give a friendly advice too. 😉
The only one who bought whatever propaganda is you, citizen point system? I have no idea and do you personally know any Chinese citizen knowing this so called points?

Is this the so called citizen points you are talking about? Only brainless idiots eat whatever crap western media feed them.


微信图片_20220628022742.png
 
Last edited:

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
Well obviously ot didn't prevent anywhere near 200k to 1.5 milons deaths during the last famin. I believe that USA ( the country which you want to " liberate" World from) saved hundreds of millions throughout decades. Am I inventing something here? It is you here who is promoting " altruism " in regards to USA yet realities tell different story, don't they? I believe more then once your own country was helped here there by the insolent imperialists. True or not?
What are you talking about? world poverty is China's problem? why that is China's liability? US invaded Afghanistan and Iraq which caused the wide spread poverty and famine, we didn't invade any country, why do you think anyone is China's liability?
 
Last edited:

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
I was specific wasn't I? Can you point out exactly that world where I said that world poverty problem is China problem? Invaded ( USA) somebody besid being digression does Tibet, East Turkesta, ring a bell?
It's like saying US invading California and New York... so pathetic, which countries recognize Xinjiang and Tibet as independent countries? You are so brainwahsed to the point of not knowing basic knowledge.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
So I repeat for the 3rd time , WHY DIDN'T YOU GIVE A BAG OF RICE TO YOUR BEST BUDDY WHILE HE WAS IN NEED. A simple question really alas seemingly even simple question pose a problem for you, so answer. If nor I will ask it 4th time as I have a bit of time, so here is your chance, go on
Where did you hear this joke? You base your arguement on jokes? How many times I have to ask you the origin of this misinformation?


China sent 240,074 tonnes of food aid in 2012 - more than 80 times the amount the European Commission gave North Korea that year - according to the UN.
In 2016, Beijing announced it was providing $3m in humanitarian aid to flood-hit North Korea after international agencies failed to raise sufficient funds.

A report to US Congress in 2014 said: "China, currently believed to be North Korea's largest source of food aid, has no known monitoring systems in place."
Other nations offer humanitarian support to North Korea through UN agencies, NGOs and the International Red Cross.
 

Mehmed Ali

Committed member
Messages
279
Reactions
625
Nation of residence
England(UK)
Nation of origin
Bosnia & Herzegovina
By the way as north Korea is technically in war USA, so why should they give them anything. Anyway I am not heart broken about that let them carry on the people's revolution.
 

Nilgiri

Satire Enjoyer
Moderator
Aviation Specialist
Messages
7,068
Reactions
16 14,015
Nation of residence
Canada
Nation of origin
India
That would be great news for all, especially for Indonesia - that has no other way to recover economically due to a total currency manipulation by the US$ since 1997/8. The next step will be the decoupling from the US$ and it's controlled world spot market prices and currency echange rates.

If the PRC/CCP truly believed that, they would have simply had one of their state banks open a bank account with Carrie Lam when she came under US sanction.

Instead she had to be paid with briefcases of cash in a most humiliating way.

Same thing happening again w.r.t Russia right now.....what the CCP "says" and what PRC companies actually do (regarding carefully not rocking the boat with the west and avoiding transactions with sanctioned russian companies).

Quite a telling final root realised dissonance from the sheer amount of time the troll hordes from China use to keep wildly gesticulating about.

An awful amount of time was spent on the "red guard" back in the day for same reason. That stuff lingers....though the names and methods change with the times.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
Tibet and Eastern Turkestan are occupied territories , ok? Get it in your head ok? For the 4th time
Lol, just because you say so? California is occupied land, ok? just because I say so. which government say they are occupied lands? your government? Britian?
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
Why didn't you send a bag of rice to your friends in North Korea. Please spear me of your flisculas and some unimaginative silly cartoons.
Where did you get this info? your own delusional mind? how many times I have to ask you this question?
 

Jagdflieger

Contributor
Messages
504
Reactions
279
Nation of residence
China
Nation of origin
Germany
If the PRC/CCP truly believed that, they would have simply had one of their state banks open a bank account with Carrie Lam when she came under US sanction.
It would be absolutely naive to believe that a single country or it's central bank can uproot and free the world from the manipulated $ dominance.

As the USA is unsuccessfully trying to form alliances to counter China's and other's economy - China with four other countries has set the way to successfully bring up an alternative - and many more countries are bound to follow, since it is only advantageous to their economy and will aid to reset the crippled currencies of 3rd world countries.

....not rocking the boat with the west and avoiding transactions with sanctioned russian companies....

You are referring to India's present "super-deals" with Russian oil? or their reluctance to follow embargoes/sanctions onto Russia?, it doesn't really matter as to which direction India opts to. A country caught in a 2000 year's trap of a society encompassing cast system - will never be able to really develop. Enhancing the GDP just via cheap labor manufacturing, doesn't solve the actual problem of being culturaly unable towards enhancing a society and as such it's economy.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
This is just the beginning, many more countries will join, the world is sick and tired of endless western sanctions and global dollar dominantion. Yuan is backed by unrivaled Chinese manufacturing juggernaut, dollar is backed by nothing now.
 

xizhimen

Veteran Member
Messages
7,387
Reactions
376
Nation of residence
China
Nation of origin
China
China Moots Yuan Pooling Scheme To Counter US Dollar Dominance, Signs Pact With Bank For International Settlements
byPTI-Jun 28, 2022 01:46 PM +05:30 IST

swarajya%2F2022-06%2F39d7bc9c-5db7-42ba-82ec-a9dbdb0e74aa%2Fus_dollar_chinese_yuan_103316431_l.jpg

The US Dollar and the Chinese Yuan.

Beijing, Jun 28 (PTI) China's central bank has signed an agreement with Switzerland based Bank for International Settlements (BIS) as part of Beijing’s plans to establish a yuan pooling scheme starting with Indonesia, Malaysia, Hong Kong, Singapore and Chile to counter the dominance of the US dollar.

The arrangement aims to provide liquidity support for participating central banks during future periods of market volatility by creating a reserve pool, the People's Bank of China (PBOC), which signed the agreement with BIS last Saturday, said.

The establishment of the arrangement is conducive to meeting the reasonable international demand for the renminbi, and will make positive contributions to the enhancement of the regional financial safety net, the apex bank said.

The arrangement initially includes central banks in Asia and the Pacific, including Bank Indonesia, the Central Bank of Malaysia, the Hong Kong Monetary Authority, the Monetary Authority of Singapore and the Central Bank of Chile, the PBOC said.

The plan comes amid heightened worry in Beijing about the US dollar dominance and search by the global investors for safe harbours as the US embarked on monetary normalisation to tame high inflation, the Hong Kong-based South China Morning Post reported on Tuesday.

The Renminbi Liquidity Arrangement, which could be used in periods of market volatility in the future, initially includes the PBOC, the Bank Indonesia, the Central Bank of Malaysia, the Hong Kong Monetary Authority, the Monetary Authority of Singapore and the Central Bank of Chile.

Each participant will contribute a minimum of 15 billion yuan (USD 2.2 billion) or the equivalent in US dollars, creating a reserve pool at the BIS, a statement from the Switzerland-based financial institution owned by central banks said.

They will also have access to additional funding through a collateralised liquidity window, which allows participating central banks to make additional borrowing using their existing holdings as collateral, the Post report said.

Lately, China’s renminbi has been used more often in trade settlements, international investment and financing, and foreign exchange transactions, more central banks have included it in their foreign exchange reserve pools, and market players have gradually displayed increased willingness to use it, state-run China Daily reported.

However, the US Federal Reserve is speeding up tightening of monetary systems and launched the process of balance sheet contractions in June.

Against this backdrop, the launch of a renminbi liquidity arrangement is of great significance to defusing potential risks, the Daily’s report said.

“It could draw more members to join in the future,” said Ding Shuang, chief Greater China economist at Standard Chartered Bank.

China has for years sought to increase global use of the yuan.

Beijing has signed more than three trillion yuan worth of bilateral currency swap deals with more than 40 countries, including 400 billion yuan each with Hong Kong and South Korea, 350 billion yuan each with the Bank of England and the European Central Bank, 300 billion yuan with Singapore and 150 billion yuan with Russia, according to the Post report.

Chinese authorities took a prudent approach to yuan internationalisation in the 14th five-year plan for 2021-25, calling it a matter of market choice and a gradual process.

“The announcement shows that the Chinese central bank has been making a huge effort to promote the construction of institutional infrastructure. This could be due to the weaponisation of finance in recent years,” he told the Post.

While tension over the Hong Kong national security law triggered heated discussions over potential China-US financial decoupling in 2020, recent Western sanctions on Moscow have served as a particular wake-up call for Beijing, including the exclusion of major Russian banks from the Swift messaging system and freezing the assets of the Russian central bank.

The share of the yuan in global payments, forex transactions and reserve assets is still far behind the US dollar, but many analysts believe the Russia-Ukraine war and market turmoil following the US Federal Reserve’s aggressive rate hikes could give it a chance to catch-up.

“Sanctions have disrupted the global financial order … and they will accelerate de-dollarisation,” Citic Securities, a leading Chinese investment bank, wrote in its midyear outlook last week. Beijing’s plan for yuan internationalisation may also get a push through the Belt and Road Initiative, especially within Asia, the Post report said.

“The yuan has initially played the role of an anchor currency in Asia,” Ding Zhijie, head of the State Administration of Foreign Exchange’s (SAFE) research centre, wrote in the June issue of Modern Bankers magazine.

But the SAFE official said yuan internationalisation will be complicated and a long-term task.

“In the future we should pay more attention to economic connections and enhance regional monetary and financial cooperation,” he said.

The yuan accounted for 2.14 per cent of global payments in April, far below the 41.81 per cent commanded by the US dollar.

In terms of its proportion of global foreign exchange reserves, the yuan ranked fifth at the end of last year with a 2.79 per cent share, compared to the 58.5 per cent for the US dollar and 20.6 per cent for the euro.

The yuan’s weight in the International Monetary Fund’s special drawing rights basket will be raised to 12.28 per cent on August 1, an increase of 1.36 percentage points from the 2016 assessment, according to the Post report.

 

Viva_vietnamm

Contributor
Moderator
Vietnam Moderator
Messages
512
Reactions
371
Nation of residence
Vietnam
Nation of origin
Vietnam
This is just the beginning, many more countries will join, the world is sick and tired of endless western sanctions and global dollar dominantion. Yuan is backed by unrivaled Chinese manufacturing juggernaut, dollar is backed by nothing now.
CN is "manufacturing juggernau" mainly bcs CN is one of the biggest markets for those products. If CN stop buying those products (eg Samsung phones) then those factories will quickly quit CN and move to VN.

------------------

Apple to produce iPad in Vietnam for the first time​

By Dat Nguyen June 2, 2022 | 01:16 pm GMT+7
Apple to produce iPad in Vietnam for the first time


Attendees try out the iPad Pro during an Apple launch event in the Brooklyn borough of New York, U.S., October 30, 2018. Photo by Reuters/Shannon Stapleton
Apple will make its iPads for the first time in Vietnam as part of efforts to diversify its supply chain and reduce dependence on China, its main manufacturer.

 

Jagdflieger

Contributor
Messages
504
Reactions
279
Nation of residence
China
Nation of origin
Germany
Doesn't really matter since China is the biggest I-phone producer and market in the world. With the vast market majority being Chinese brands.
If e.g. Samsung moves out - a Chinese manufacturer will take their market share aka their employees - so?

And if next time e.g. Vietnam, Malaysia or India are not obliging USA political demands - they will be facing a 25% export tax as well. Woosh.. there goes the cheap labor benefit for Apple and etc.

Significance for Investors​


Apple's pivot away from dependence on China as its main manufacturing hub comes with both pluses and minuses. The major plus is that this hedges against the possibility that the United States and China will remain locked in a protracted trade war, with U.S.-imposed tariffs persisting. Another plus is that Apple will realize savings by moving production to lower-cost locales.

On the minus side of the ledger, Apple is moving production away from a country with, as noted above, a well-developed business ecosystem and infrastructure that has served Apple well. As a result, it is possible that Apple's further diversification of production across international boundaries actually may do the opposite of the expected and increase risk. One example was the recent worker riot in India, due to the missteps of a subcontractor under pressure from Apple to ramp up production rapidly at a new plant, in a country whose laws and culture it did not understand.
 
Top Bottom