Pakistan lets companies use Yuan in trade with China
Thursday, 04 January 2018

Pakistani companies have been given a green light to use the Chinese yuan in trade with Beijing, which could potentially sideline the US dollar and other currencies used there. The move coincides with a US-Pakistan aid row.

The State Bank of Pakistan (SBP) said it "has taken comprehensive policy-related measures to ensure that imports, exports and financing transactions can be denominated in CNY," according to a statement issued late on Tuesday. CNY is now effectively on par with the US dollar, euro and other international currencies in the country.

Companies are free to engage in CNY transactions with the immediate effect. "SBP has already put in place the required regulatory framework which facilitates use of Chinese yuan in trade and investment transactions," the bank said.

It also noted the "growing size of trade and investment" between Pakistan and China under the China-Pakistan Economic Corridor (CPEC) agreement. The use of yuan will further boost bilateral trade and "will yield long-term benefits for both [of] the countries," the bank added.

 



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