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Canada becomes the 11th. country to secure an offshore yuan or renminbi (RMB) trading hub with China
9 November 2014
During the month of October several articles were published in the Financial Post and Globe & Mail on a soon to be announced opening of renminbi trading hubs, possibly in both Vancouver and Toronto, which were to be finalized during the Canadian trade mission to China led by PM Harper which concluded this weekend. This development was heralded as key to reset China-Canada relations and increase bilateral trade by $20 billion. Indeed China’s Xinhua press agency reported on November 8, in a terse press release, the signing of the memorandum of understanding between China and Canada for a Renminbi (RMB) clearing settlement in Canada: China, Canada ink currency swap deal BEIJING, Nov. 8 (Xinhua) — China’s central bank signed a currency swap deal worth 200 billion yuan (32.79 billion U.S. dollars) with the central bank of Canada. The three-year deal could be extended upon agreement by the two sides, said a statement on the website of the People’s Bank of China. Also on Saturday, the two sides signed a memorandum of understanding for Renminbi (RMB) clearing settlement in Canada. China agreed to extend the RMB Qualified Foreign Institutional Investor scheme to Canada, with an initial quota of 50 billion yuan. The deal marked a new step forward in financial cooperation between the two countries, and will facilitate bilateral trade and investment to help maintain regional financial stability, the statement said. Editor: Luan As the November 4 Financial Post article by Barry Critchley Canada could become the only country in the world with two yuan trading hubs explains “it can take between six months and two years for the hub to be fully operational”. Among the 11 countries which have been authorized by the bank of China as an offshore currency hub, 5 are among China’s 7 largest trading partners. These are: #2 Hong Kong, #4 The Republic of Korea, #5 Taiwan, #6 Germany, #7 Australia.(China’s largest trading partner, the United States has applied for that status and has submitted the name of San Francisco). The other 6 countries are not among the 10 largest trading partners of China. These are in random order: Singapore, London, Luxembourg, Paris, Qatar, and Canada. As Mrs. Helga Zepp-LaRouche explained in an interview given to China Radio International a few days before the opening of the APEC Summit in Beijing were she contrasted the financial woes and bankruptcies affecting the trans-Atlantic nations versus what the BRICS nations have recently achieved: “What China has proposed with the New Silk Road, the AIIB, and similar initiatives, is proposing a real alternative for how the world can get out of this crisis. So even if there is no formal resolution, we are in such an extraordinary moment of history that the fact that there is an alternative and that China and the other BRICS countries have taken a leading role, is giving hope for the rest of the world.” The founder of the Schiller Institute was referring to the end of October meeting in Beijing of 21 Asian countries which established the Asian Infrastructure Investment Bank (AIIB), whereby the AIIB, the BRICS and the Shanghai Cooperation Organization (SCO) are presently challenging the “Washington Consensus” which has dictated its murderous refinancing conditions to most of the world in a manner which threatens those nations with destruction either through famine, pestilence or war. Is Canada simply interested in a better deck chair on the sinking Titanic? While nobody in Canada would rationally oppose creating new jobs through acquiring a renminbi hub set to increase Canada’s trade with China, but that is not the defining issue vis-à-vis China and the more just new world economic order that the BRICS nations have launched. There are presently two irreconcilable world views which are facing off in the international arena. Canada has to decide if it will abandon Her Majesty’s imperial financial institutions, which are doomed and can only lead to another world war. Again, Mrs. Zepp-LaRouche in her CRI interview was clear as to why decide now to choose a new paradigm for mankind: “Because the TPP is based on the idea of the complete control of the "free market" by the multinational corporations, by the too-big-to-fail banks, and it would eliminate national sovereignty almost completely. Even the parliamentarians in the countries which are supposed to join the TPP and the TPIP, which is the equivalent for the trans-Atlantic region, even they don’t know what the content of these arrangements are. So it is a completely non-transparent mechanism which would empower the multinationals and the CEOs of the top 400 corporations of the world at the expense of the common good of the people and of national sovereignty. And I think the conception which is pushed by China is coherent with the policies of the BRICS countries and is therefore following a completely different spirit as the AIIB and the New Development Bank, and the planned Shanghai Corporation Organization Bank, because these banks are not geared toward profit, but they are geared toward investment in the real economy. And that is a big difference.” [GG] |