China wants direct exchange of RMB with BDT

China wants a direct exchange of its currency Renminbi (RMB) with Bangladesh Taka (BDT) for cross-border transactions between the two countries.
"It will be win-win (for both countries)…. By the direct transaction of RMB and your local currency, you will be reducing at least 3.0 per cent transaction cost," said Dr. Liu Guangxi, leader of a Chinese financial delegation who just visited Bangladesh.
"We have met the officials of the Bangladesh Bank (BB) and they expressed their 'very positive' response," said Mr Guangxi, also director general of The Financial Service Office of the People's Government of Yunnan Province, Wednesday.
Mr Guangxi, who led the eight-member delegation during their two-day visit to Bangladesh, shared the views with a group of journalists at a city hotel.
This was the first financial delegation of Chinese local government in Bangladesh, he said.
Direct transaction of RMB and BDT "will be beneficial for trade, investment and business operations" in both the countries, he said.
"We would like to work together and promote the regional and sub-regional financial cooperation, especially in three fields including commercial banking with cross-border direct dealing of RMB and BDT," the delegation leader said.
In reply to a query he said, "There might be some difficulties, but you will look forward. Internationalisation of RMB is possible…Because China is the second largest economy. It is well capable…."
An official who met the delegation, however, said a good number of countries have already agreed in principle to accept the direct cross-border transaction of RMB and their respective local currencies.
During their visit, the delegation also met officials of Bangladesh Securities and Exchange Commission (BSEC), Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE).
Mr Guangxi further said they discussed issues of establishing financial interaction of China with the central bank of Bangladesh, the securities regulator and some commercial banks.
Besides, they look for the possibility to set up some local banks' representative offices or branches in Kunming, the capital of Yunnan Province.
"Kunming is working very hard to establish an international financial centre," Mr Guangxi said, adding that they are focusing on accelerating of the cross-border RMB settlement and setting up a financial industrial park in Kunming.
The delegation discussed with the securities regulator and other stakeholders about establishing a regional stock exchange-Pan Asia Stock Exchange (PASE)-mainly to get funds as share capital from it to finance the projects of Bangladesh, China, India and Myanmar-Economic Corridor (BCIM-EC) Silk Road. In the corridor, there will be a lot of infrastructure-communication, energy, hydropower and internet that require more and more money to finance all these projects, he continued.
"We would like to further promote regional and sub-regional cooperation in the field of capital market and securities to help enterprises from China, Bangladesh and South Asia to get more and more finance from the market," said Mr Guangxi.
The delegation also searched for business opportunities for the Yunnan-based Chinese enterprises and entrepreneurs in Bangladesh, especially in the field of establishment of industrial park, agriculture and textile etc.
Jinxin Liu, chairman of China Kunming International Logistics and Finance Association, said they are looking for local partners in Bangladesh to set up factories and do business here.  
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