Luxembourg to build an offshore RMB center

On May 28, the “Cooperation and Opportunities” RMB business seminar sponsored by the China Industrial and Commercial Bank of China was held in Luxembourg. Luxembourg Finance Minister Luc Frieden Brussels came to the seminar before the meeting of EU finance ministers and warmly welcomed CIBC to operate RMB business in Luxembourg and Europe. He stressed that “Luxembourg is determined to build an offshore RMB business center” and “work together to achieve win-win results”. Frieden had expressed the wish on several occasions previously that the Luxembourg is optimistic about the potential to become an international center for Chinese currency renminbi (RMB) business.

According to the Industrial and Commercial Bank of China (ICBC), as of January this year, RMB deposits in Luxembourg reached 20 billion yuan (US$ 3.2 billion), the largest in the euro zone. Luxembourg Central Bank statistics showed that throughout 2011 the total trading size of yuan was more than 700 million yuan (US$ 112 billion), increased by twice compared with the 240 million yuan (US$ 38.4 million) in the full year of 2010. In addition, the management of the capital in RMB in Luxembourg reached 200 billion yuan (US$ 320 million).

Luxembourg government and local industry have high expectations of future development on the yuan business as well as being very optimistic about the development potential of yuan as an international currency. Luxembourg Financial Markets Association, Xi Lvke · Fan Lahuo Wen told reporter that: “Much of the large scale trade between the EU and China in term of financial transactions and mergers and acquisitions are carried out through Luxembourg. Market is calling for a birth of a new major currency, the RMB has considerably great potential to be such a currency.

Source: People’s Daily

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