The final frontier: renminbi hedging and Africa
In the last 12 months bond deals in Brazil and Mexico and initiatives to make London a centre for RMB trading have signalled the global status of China’s currency. A rapid expansion of Chinese trade with Africa has seen the yuan move into the final frontier in global financial markets
Unlike the majority of the global economy, trade between China and Africa is booming. Two-way trade stood at $166 billion in 2011, triple its 2006 amount and making China Africa’s largest trading partner. Standard Bank estimated in April this year that African imports of Chinese goods are up 24% since 2008, and account for 4% of China’s total exports. A trade network of over 1,500 Chinese corporates operate in 18 African nations.
This is reflected in a rapid increase in renminbi use in Africa
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