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Asia-PacificJuly 1 2012

Europe ready for arrival of the renminbi

As the Chinese authorities lift restrictions and open up the renminbi market stage by stage, the significance of what is unfolding has not gone unrecognised in Europe, and, according to a recent survey by The Banker, it is not only those already doing business with the country that are interested in the renminbi's development. As London takes steps to establish itself as an offshore renminbi financial centre, many are anxious to take advantage of the opportunities soon to be available.
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The rise of the renminbi is a hot topic for the banking industry, and awareness of the role of the Chinese currency has spread beyond Hong Kong to London, which is establishing itself as an offshore renminbi financial centre. Many banking executives have already recognised the potential for the renminbi and envisioned a world where it is a fully convertible reserve currency of comparable status to the US dollar. Although reluctant to predict a date for when such a vision will come to fruition, banks are keeping pace with the developments of the Chinese central bank as it gradually lifts restrictions, putting the currency on the path to internationalisation.

Establishing offshore centres beyond Asia is crucial for the currency to internationalise, and now the awareness of the renminbi has spread beyond those working in the banking industry. A survey by The Banker demonstrates that awareness has now spread to Europe, where professionals – even those outside the banking industry, and who do not have a business relationship with China – are aware of the future significance of the Chinese currency.

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