China’s Yuan finds new ground in Central Asia
AgenciesExpanding use of the Chinese yuan in fast-growing Central Asia, where China is a top investor, can reduce risks and costs for infrastructure firms, part of a broader trend...
China's yuan is gaining traction in Central Asia, a region that is rapidly growing and a top investment destination for China, according to panelists at a Hong Kong investment event. The growing use of the Chinese currency in this area can help infrastructure firms mitigate risks and reduce expenses, a trend that is spreading wherever commercial activities spur demand for the yuan, the speakers noted.
By reducing the risks associated with currency exchanges, especially in an environment where the US dollar is strong, and cutting the costs of exporting equipment from China, the international adoption of the renminbi becomes especially important for Chinese enterprises in this region, said Long Jisheng, CEO of Shanghai-based waste management firm SUS Environment.
He emphasized that exchange-rate fluctuations could erode profits in the infrastructure sector, where margins are tight. Long stressed that Chinese companies require a closed-loop financial system, entirely denominated in yuan, covering investment, financing, procurement, and returns, to address this challenge. This financial strategy is becoming increasingly vital in the five-country Central Asian region, which has recently garnered international attention due to its vast mineral resources.
Over 11,000 enterprises with Chinese investment are operating in this region, with SUS Environment being one of them.
Written by urgent.news from Qatar Tribune Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
