HSBC Bank Oman corporate clients explore chinese currency’s increasing role and new opportunities in world trade

Experts and senior analysts from HSBC discussed how China’s businesses and Renminbi currency (RMB) are playing an increasingly important role in world trade during a seminar organized for HSBC Bank Oman’s corporate clients. The event explored the developing trend and what it means for companies in Oman.

Globally, the use of RMB has been increasing since 2009, when China launched a pilot programme to internationalise its currency by allowing the RMB to be used to settle cross-border trade. Since then, China's trading partners have increasingly been able to use the RMB when paying for imports or receiving payments for exports.

There are more than 30 markets worldwide conducting over 10% of their business with China in RMB, and the RMB cross-border capital flows have also taken off. RMB FDI almost tripled in 2012, and RMB ODI surged by 50%. In parallel, RMB investment opportunities are opening up all around the world – supported by thriving offshore markets that are expanding offshore hedging, fundraising and other financing needs denominated in RMB.

Iain Morrison, Head of Commercial Banking for HSBC Bank Oman S.A.O.G, explained that HSBC is capable of providing its corporate clients in Oman with unmatched industry analysis and insights as a result of the Group’s long standing experience and international footprint.

He added: “The Renminbi has become part of everyday business for anyone trading with or investing in China. It is already an important global trading currency and is set to become a top three global trading currency by 2015. HSBC Bank Oman is in a position to help businesses and investors in the Sultanate seize this opportunity through a comprehensive suite of Renminbi-denominated products that are available onshore on the Chinese mainland and in offshore markets worldwide. These trades can be made with no restrictions from Chinese regulators.”

Speaking at the session,Simon Williams, Chief Economist for HSBC Middle East and North Africa, commented: “China has been outperforming the US and EU despite cyclical slowdown in other Asian nations. Williams explained that China is setting the tone for generations to come in emerging markets with improved employment, increased public spending and economic reforms.

“The Middle East and specifically the Gulf States are in a prime position to benefit from the current trends with energy intensive economies naturally turning towards the East while oil prices continue to rise and public expenditure reaching unprecedented levels.”

Trade between China and 16 of the largest Arab states grew from US$13.5 billion in 2001 to US$182 billion in 2011.

HSBC Bank Oman today serves more than 10,000 corporate clients from various sectors such as government, automotive, industry, oil and gas, telecommunications and construction. The bank provides expert local and international advice to clients and offers a comprehensive basket of products and services that are supported by global expertise to help make international business easier.