RMB growth steadies in 2016, setting solid foundation for further internationalisation
Special edition of SWIFT’s RMB Tracker, for the SWIFT Greater China Regional Conference 2016, provides data and analysis of the Chinese currency for the first half of the year
This press release is also available in Chinese
Shanghai, 21 July 2016 – Data from SWIFT’s RMB Tracker shows that despite continued growth globally, the Canadian dollar has overtaken the RMB with a 1.96% share of world payments currencies, leaving the RMB at position number six with a 1.72% share in June. The data marks a gradual, but expected, slowdown for the currency in 2016 as it continues on its path to internationalisation. In spite of this trend, and as of June 2016, more than 1,800 financial institutions worldwide are using the RMB for payments (with or without China and Hong Kong), representing a 12% increase compared to the same month last year.
With the occasion of the SWIFT Greater China Regional Conference taking place in Shanghai on the 21 July 2016, a special edition of The RMB Tracker has been published. This report focuses on 2016 half-year statistics and analysis from SWIFT, as well as insights from financial industry experts on the recent evolutions of the RMB and what the future has in store for the Chinese currency.
Data within the report shows that in the first half of 2016, the Japanese Yen edged past the RMB to become the most active currency within APAC for payments with China and Hong Kong, with a 32.8% share (RMB at 31.2%). New offshore centres have emerged including Seoul and Canada, and the United Kingdom has regained its status as the number one clearing centre after Hong Kong, processing 24.4% of RMB payments, excluding China and Hong Kong.
Alain Raes, Chief Executive, Asia Pacific & EMEA at SWIFT said: “As RMB growth is linked to China’s economic activity, data suggests that the volatility in the Chinese market and the slowdown of the Chinese economy are likely factors that have impacted offshore RMB usage this past year. On a positive note, key initiatives, such as the progress of China’s new Cross border Inter-Bank Payments System (CIPS) and the opening of new offshore clearing centres, sets a solid foundation for future growth. These initiatives, when combined with industry efforts to expand the RMB’s reach, enhance products and services and focus more on standards and compliance, sets the RMB on a clear path towards internationalisation.”
To complement the Chinese market’s efforts to broadly connect its currency to offshore markets, China International Payment Service Corp., (CIPS Co.) signed a Memorandum of Understanding (MOU) with SWIFT in March for cross-border interbank payment system cooperation. The MOU sets out plans for a strategic collaboration to develop the Chinese payments platform using SWIFT as a channel to connect CIPS with SWIFT’s global user community. Access to the SWIFT user community provides CIPS with a platform to capture cross-border RMB flows to all types of participants, significantly extending the reach of the currency.
Download SWIFT’s special edition RMB Tracker report:
About SWIFT and RMB Internationalisation
Since 2010, SWIFT has actively supported its customers and the financial industry regarding RMB internationalisation through various publications and reports. Through its Business Intelligence Solutions team, SWIFT publishes key adoption statistics in the RMB Tracker, insights on the implications of RMB internationalisation, perspectives on RMB clearing and offshore clearing guidelines, supports bank’s commercial RMB product launches and provides in-depth analysis and business intelligence, as well as engaging with offshore clearing centres and the Chinese financial community to support the further internationalisation of the RMB.
The SWIFT network fully supports global RMB transactions, and its messaging services enable Chinese character transportation via Chinese Commercial Code (CCC) in FIN or via Chinese characters in MX (ISO 20022 messages). It offers a suite of dedicated RMB business intelligence products and services to support financial institutions and corporates. In addition, SWIFT collaborates with the community to publish the Offshore and Cross-Border RMB Best Practice Guidelines, which facilitate standardised RMB back office operations.
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