Renminbi accounts for over 30 percent of payments between South Africa and China
Recent data compiled by The Society for Worldwide Interbank Financial Telecommunication (SWIFT) shows that the number of South Africa’s payments in Renminbi (RMB) increased by 33 percent over the last 12 months and by as much 191 percent over the last two years.
Renminbi is the official currency of the People’s Republic of China.
SWIFT is a member-owned cooperative through which the financial world conducts its business operations; nearly 11,000 financial organisations across over 200 countries utilise its skills.
Direct payments value between South Africa and Greater China (which includes Hong Kong) that were carried out using RMB were 10.8 percent in June 2014 compared with only 4.6 percent in June 2013.
As well as direct flows between South Africa and Greater China, SWIFT data shows that nearly 70 percent of the number of payments between the latter is still intermediated by the United States, mainly in US dollars.
Hugo Smit, SWIFTs Head of Africa South, said: “The rise of RMB usage in South Africa is another good indicator of the cross border use of the currency. Much of this growth has to do with the strengthened bi-lateral relations between South Africa and China, which were renewed at the end of 2014 to include trade co-operation and sustainable investment opportunities between the two countries. As a result of this effort, RMB usage in South Africa should continue to grow at a good rate.”
In June 2015, the RMB was recorded as the fifth most active currency for global payments in value and accounted for 2.09 percent of global payments, a slight decrease from 2.18 percent in May 2015. Overall, RMB payments increased in value by 9.26 percent in June 2015, while growth for all payments currencies was at 14.46 percent