Minister: 'extensive foundation' to trade Chinese currency

Wed, Nov 18th 2015, 07:11 AM

The Bahamas' financial services sector still has extensive "foundational work" ahead of it before the country can serve as a regional trading hub for Chinese renminbi currency, according to Minister of Financial Services Hope Strachan.

Speaking during the Bahamas Institute of Chartered Accountants' (BICA) Extraordinary General Meeting yesterday, Strachan stated that her team has recently met with representatives from the People's Bank of China but remained tight-lipped on the specifics of any institutional overhauls or assurances that need to be met before the country can capitalize on a nearly year-old agreement in principle with the Chinese government.

"There has been much buzz about establishing The Bahamas as hub for the trading of the Chinese currency, the renminbi. During my recent trip to China this matter was addressed when I met with The People's Bank of China. There is much foundational work to be done on this issue. My ministry will continue to work with and engage relevant authorities in this effort and will keep you informed of our progress," she said.

In January, Chinese President Xi Jinping announced an agreement in principle that would allow The Bahamas to trade in renminbi following two years of negotiations between Chinese and Bahamian authorities. The move, which would make The Bahamas only the second recognized renminbi trading hub in the Americas, was warmly welcomed by the Bahamas Financial Services Board (BFSB) who viewed it as a unique trade and investment opportunity for the country.

When pressed by Guardian Business for specifics about the steps that needed to be taken before advancing the hub - or the stakeholders involved in the process - Strachan replied: "It has to do with everything."

"I met with the bank and discussed the way forward but there's a lot of groundwork, foundational work, that needs to be done. That's the most that I can say at this point - a lot of foundational work would have to be done," she said.

Strachan's comments come days after the Ministry of Financial Services and BFSB's recent tour of Asian and Latin American markets seeking to promote The Bahamas' financial services products. Other concurrent projects within the Ministry of Financial Services include plans for establishing a regional arbitration center, as well as a broader center of excellence for financial services, within The Bahamas. All of these reforms or new programs, Strachan asserted, were critical for the survival of the country's financial services sector.

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