Chinese currency to be used for all new CPEC projects

[ghazi52]

Chinese currency to be used for all new CPEC projects

Pakistan has agreed with China for allowing utilisation of Chinese currency Renminbi (RMB) for execution of all new projects of energy sector under the multi-billion dollar China Pakistan Economic Corridor (CPEC), according to media.

Instead of US dollar, use of RMB will be a major development if this agreement turns into reality. Now a summary will be moved before the Economic Coordination Committee (ECC) of the Cabinet for getting formal approval to this effect.

Sources quoted in the report said that the Joint Working Group (JWG) agreed to use RMB for all new energy projects in Pakistan.

According to the report the Senior Officials Meeting (SOM) will be held on Tuesday morning and then JCC will be held in the afternoon. Both sides will sign MoUs after the JCC meeting. It is also expected that China’s visiting NDRC Minister and Minister for Planning will also hold joint press briefing on Tuesday night.

In the JWG meeting, Pakistan and China evolved consensus that RMB would be used for making arrangement to execute all new projects of energy sector under CPEC. This important development was also shared in a roundtable organised by Pakistan China Institute (PCI) led by Senator Mushahid Hussain Sayed in Karachi on last Sunday

 

[Telescopic Sight]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

 

[Haris Ali2140]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

Its either yuan or dollar.

 

[PakFactor]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

It’ll be ad advantage as dollar getting stronger while rupee weakens this will stabilize things some what. Essentially if this goes through, others might forced to convert to trade through CPEC to get people off the dollar drug.

 

[cloud4000]

Yuan has appreciated against the rupee as well but not as bad as the dollar. It will be cheaper for Pakistan to pay with yuan than dollar. But this does not include non-CPEC projects and other transactions, however, and may still require dollars.

 

[vi-va]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

It will benefit both sides if you use the currency of your major trading partner and investor as long as the currency is relatively stable.
You get the Yuan from investment and trade, and use the same currency for trade or pay back the loan. It will decrease the transaction fee.
China can provide limited US dollars for investment, although China has 3 trillion foreign exchange reserve. But China can provide unlimited China Yuan, which means it won't hurt China foreign exchange reserve at all if Pakistan delay the payment.
It also increase the cooperation potential because China companies would like to set the factory in Pakistan and get the payment back in Yuan. Pakistan can get more jobs and investment, imo.

 

[Dil Pakistan]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

It is a definite advantage for Pakistan, as Pakistan does not need to spend her precious dollars reserves on this international project. Keeping the dollars unspent will raise the reserves.

Benefit for China, it currency will internationalize. From one country it will become two and then so on.

 

[ARMalik]

Any country with sane economic managers would keep a basket of US dollar, Yuan, Euro, Gold etc and not rely on just one currency. But then this country has been led by economic terrorists for such a long time.

 

[Beast]

Is this an advantage for either side ? Or just one side ? Genuinely curious what you folks think.

salty american.... Typical tactic to try mislead reader thinking its only benefit China. China is world factory and RMB can used to buy a lot of value for money necessity needed by Pakistan.

While what benefit Pakistan if they used USD only? Bind themselves to US dollar blackmail and speculating? US can print unlimited money, US is not a responsible country. Those holding USD can subject to rapid monetary depreciation quickly once US start large amount of printing USD.

 

[doorstar]

salty American...

more like a gungoo in America!

 

[khail007]

salty american

Sir, behind salty American, there is real 'Gungu' is hiding - both faces are untrustworthy.

 

[Hakikat ve Hikmet]

Pak is taking war time preps...

 

[Telescopic Sight]

salty american

Time to hit the Mandarin - English translator harder , Mr. Govt. Employee

 

[Cookie Monster]

salty american.... Typical tactic to try mislead reader thinking its only benefit China. China is world factory and RMB can used to buy a lot of value for money necessity needed by Pakistan.

While what benefit Pakistan if they used USD only? Bind themselves to US dollar blackmail and speculating? US can print unlimited money, US is not a responsible country. Those holding USD can subject to rapid monetary depreciation quickly once US start large amount of printing USD.

Based on his behavior and obsession with Pak...I would say he is Indian. I often find him on India/Pak threads...that behavior is not typical of an American.

 

[Verve]

Good for both.

This was part of the plan all along.