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Heilongjiang gives priority to border trade
Last Updated(Beijing Time):2012-05-01 11:15

As a province that borders Russia, Heilongjiang has been giving priority to developing its border trade with the country.

In the process, local banks have played an important role helping Chinese and Russian enterprises do business with each other.

Last year, Heilongjiang contributed nearly $19 billion, or 24 percent, to the Sino-Russian trade volume, which reached $79.2 billion, according to Heilongjiang Customs.

Russia has become Heilongjiang's largest trade partner. As China and Russia have set a goal of lifting bilateral trade to $100 billion by 2015 and to $200 billion by 2020, the province aims to play a bigger role.

There are a large number of enterprises in the province engaged in Sino-Russian trade or investing in Russia. Currency exchange between the renminbi and rouble once was a headache for them.

In the past, a third-party currency was needed to settle Sino-Russian trade, which brought risks to enterprises due to exchange rate fluctuation and raised their costs because of settlement fees.

The situation began to improve at the end of 2010.

In November 2010, with the approval of People's Bank of China, Harbin Bank became one of the first traders between renminbi and the rouble in China's interbank foreign exchange market.

In December 2010, the nation's first rouble cash transaction market - Heilongjiang Rouble Cash Transaction Center - was set up in Harbin.

In that month, Longjiang Bank, another major lender in Heilongjiang, opened its Rouble Exchange Center in Suifenhe, one of the most important border cities in the province. This was the first official renminbi-rouble exchange center in Suifenhe.

"Before the establishment of the center, most businessmen and tourists changed their roubles into renminbi on the black market, which provided little security or a standard exchange rate," said Xu Zhihui, executive director of Longjiang Bank.

"Local banks' participation can make the exchange rate between the renminbi and the rouble more reasonable and reduce conversion costs. It also can help crack down on illegal currency exchange and prompt the healthy development of Sino-Russian trade in Suifenhe," said E Zhongqi, Party secretary of the city.

In addition, banks in Heilongjiang are providing loans to the enterprises engaged in Sino-Russian trade to help them get through financial difficulties.

Suifenhe Xinghua Economic and Trade Co, set up its wood-processing factory in Khabarovsk in Russia in 2006, and all of its wood products are sold in China.

In 2009, Harbin Bank provided a loan of $10 million to Xinghua, which helped the company overcome its funding problems. In 2009, the trade volume of the company reached 180 million yuan, double the amount in 2008.

By the end of 2011, Harbin Bank had provided $40 million in loans to Xinghua.

Source:China Daily 
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