NSW Premier Mike Baird today launched a new initiative to promote Sydney as a leading financial centre and regional trading hub for the Chinese currency, the Renminbi (RMB).
Mr Baird announced the Sydney for Renminbi initiative during a financial services roundtable in the Chinese city of Shanghai during his first overseas mission as Premier.
The Premier outlined Sydney’s financial services capabilities at the Roundtable, which was attended by senior executives from Chinese and Australian financial services companies and regulators based in Shanghai.
“Sydney is the natural home for an Australian RMB trading hub,” Mr Baird said.
“Establishing Sydney as a regional settlement hub for RMB would make it easier for Australia and China to move funds and do business.
“China is our largest trading partner. Over the past five years bilateral merchandise trade between China and NSW has grown by 48 per cent.
“However, only one per cent of Australian trade with China is currently settled in RMB. The Sydney for Renminbi initiative aims to take advantage of this opportunity.
“The RMB is now the eighth-most traded currency in the world, and in the short term it’s estimated it will be used to settle 30 per cent of China’s total trade by the end of 2015.
“Many of Australia’s biggest businesses have already made the shift, with mining firms such as Hancock Mining, Rio Tinto, and Fortescue Mining beginning to settle deals directly in RMB.”
Mr Baird said the NSW Government will promote Sydney as a leading financial services centre and RMB trading hub by partnering with industry as part of the new Sydney for Renminbi initiative, which involves:
- Establishing a Sydney RMB Working Group to provide leadership on the practical next steps for development of the RMB market in Sydney;
- Demonstrating Sydney’s commitment to the growth of the RMB as a leading international currency;
- Supporting the Australian Government in securing a clearing bank for Sydney;
- Promoting opportunities for our businesses to do direct trade with China to reduce their costs and risks by trading in RMB.
Mr Baird said the Sydney for Renminbi initiative will build on Sydney’s reputation as one of the world’s significant financial centres.
“Sydney leads Australia in banking, wealth management, insurance, legal services, accounting, digital-ICT, creative industries and engineering.
“The World Economic Forum recently rated Australia as one of the most open, efficient and well regulated financial services sectors in the world and Sydney, Australia’s financial and business capital, is right at the heart of that achievement.
“Sydney’s financial services sector generates about $57 billion a year for the economy and is increasingly being recognised as a leading financial services hub in the Asia Pacific.
“We’re building on Sydney’s financial services strengths with the next generation of financial services growth right at the heart of Sydney, in Barangaroo.
“Set to become the next Canary Wharf, Barangaroo will take Sydney’s financial services capabilities to the next level.
“Sydney for Renminbi will help to cement Sydney’s future as one of the world’s most exciting and successful financial centres,” Mr Baird said.
The Sydney for Renminbi initiative has been launched ahead of the Sydney-Shanghai Financial Services Symposium to be held in Sydney in November.
The Symposium will allow both cities to strengthen financial, economic and diplomatic ties as Sydney focuses on becoming a RMB settlement hub.