Li proposes expanding China-UK trade to $100bn in 2015

Li rules out economic hard landing

Li calls for inclusive development at global roundtable

 Premier Li Keqiang chats with British Prime Minister David Cameron before their meeting at 10 Downing Street on Tuesday. CHINA NEWA SERVICE

Premier Li Keqiang urged Britain to seize momentum to consolidate its place as one of the most important offshore yuan markets outside Asia.

"China is an emerging major financial country and its financial development and reform is underway, while the UK, as a well-established financial power, has very open and vast and time-honored financial markets and institutions," Li said at the China-UK Financial Forum in London on Wednesday.>>>More

"We have much to offer each other," Li said.

British Chancellor George Osborne, who appeared alongside Li, said the increasing importance of the yuan could lead to a historic shake-up of the global financial system, and he wants the UK to play a central role.

"I believe the emergence of China's currency as one of the world's leading currencies will be the next huge change (to the financial world)," Osborne said.

The forum, held during Li's visit to Britain, heralds direct trading between the British and Chinese currencies for the first time.

China's central bank said on Wednesday that the Chinese currency will be traded directly against sterling in the interbank foreign exchange market. >>>More

It is the latest step to facilitate investment and bilateral trade between China and Britain.

"The move will help lower foreign exchange conversion costs and will promote use of both the yuan and pound in bilateral trade and investment, which will help strengthen financial ties between the two countries," the central bank said in a statement.

The British pound will become the fifth major currency that can be traded directly with yuan in Shanghai, joining Australian and New Zealand dollars, Japanese yen and the US dollar.

Li underlined the importance of financial cooperation between the two countries during his visit.

Li hailed a deal that makes China Construction Bank the first clearing-service provider for offshore trading of yuan in London. >>>More

"It will further consolidate and promote London's status as an international financial hub and will help the gradual internationalization of RMB to promote trade and investment liberalization and facilitation," Li said in a speech to business delegates on Tuesday night.

Industry insiders say that together with the direct trade of the yuan and pound, financial cooperation between China and the UK will further boost internationalization of RMB, and will add weight to London's bid to become the yuan's European offshore hub amid competition from Frankfurt, Paris and Luxembourg.

"In London, the world's biggest foreign exchange trading center, the RMB trading volume has taken up two-thirds of the global market exclusive of the Chinese mainland and Hong Kong," said Tian Guoli, chairman of Bank of China.

Bank of China signed an agreement with the London Stock Exchange on Tuesday to develop offshore trading in the Chinese currency. >>>More

Mark Boleat, policy chairman at the City of London Corp, said he warmly welcomes the forum with offshore yuan business as one of the major topics.

It "recognizes London's role as a leading Western center for offshore yuan business and highlights the active engagement between UK and Chinese policymakers and businesses on ways to develop new areas of collaboration, trade and business partnerships", Boleat said.

Also on Tuesday, Li joined British Prime Minister David Cameron at Downing Street for talks with international financial leaders in a bid to promote global free trade.

The talks, which were chaired by Osborne, the British chancellor of the exchequer, were attended by Christine Lagarde, managing director of the International Monetary Fund; Jim Yong Kim, president of the World Bank; and Angel Gurria, head of the OECD.

The participants also represent leading developed and emerging economies and their major currencies, including the yuan, British pound, US dollar and euro.

London's RMB business keeps steady growth: report

The Renminbi, or RMB, denominated trade financing in London increased by 10 percent to around 42.8 billion Chinese yuan in 2013, compared to that of 2012, said the City of London Wednesday.

Export financing showed particularly strong results, with a substantial increase of 78 percent to 11.8 billion Chinese yuan in 2013, while import financing and letters of credit decreased by 2 and 11 percent respectively, said the City in a report authored by Bourse Consult.

Regarding the transaction figures, however, the average daily value on trading in deliverable RMB denominated foreign exchange (FX) products increased by 140 percent to 18.7 billion U.S. dollars in 2013, while trading in non-deliverable products shrank by 27 percent to 6.6 billion dollars, data showed. >>>More

Yuan-denominated green bond debuts in London

The first-ever yuan-denominated green bond was issued on Tuesday by International Finance Corp in London, marking a further step forward in the internationalization of China's currency.

The three-year bond raised 500 million yuan ($80.3 million) and was priced at a yield of 2 percent. HSBC acted as sole lead manager on the deal.

The bond is listed on the London Stock Exchange. Criteria for the use of IFC green bond proceeds are certified by Cicero, an independent research center associated with the University of Oslo. >>>More

CDB joins hands with TheCityUK 

The China Development Bank Corporation (CDB) and The City UK signed a memorandum of understanding here Tuesday to set about comprehensive cooperation in promoting Sino-British economic ties.

The document was signed in the presence of visiting Chinese Premier Li Keqiang and British Prime Minister David Cameron at the Foreign Office in London.

The two sides agreed to work together in supporting CDB to expand its financing and lending activity in Britain, including in infrastructure related investment, a statement released after the signing ceremony said. >>>More

Yuan gets boost from London partnership  

The London Stock Exchange Group (LSEG) signed agreements with two Chinese State-owned banks on Tuesday to boost offshore yuan trading in the UK.

A partnership with Bank of China (BOC) will allow the LSEG and the lender to jointly assess and design yuan clearing and financing processes for future yuan-denominated products, the LSEG said in a statement posted on its website on Tuesday. The BOC, China's third-largest lender by assets, will work toward becoming a member of the LSEG, it added.

In a separate statement, the LSEG said that it formed an alliance with the Agricultural Bank of China to facilitate access to capital by Chinese companies through LSE's Primary Markets operations and to support investor education and awareness programs in China and the UK. >>>More 

Agreement for yuan clearing bank signed

Offshore yuan activities are accelerating in London, aided by new announcements on Tuesday regarding the appointment of a yuan clearing bank in London and an agreement for direct yuan-pound trading.

China Construction Bank will become London's official yuan clearing bank. The two countries have also agreed to set up direct pound-yuan trading, making British pound one of the few currencies in the world to have direct trading with the yuan. >>>More