The Chinese Yuan Continues to Make Further Inroads Into Africa

In yet a further signal of the growing adoption of the Chinese Yuan as an international currency and further de-dollarisation we note that the Namibian commercial bank, Bank Windhoek, has commenced the trading of Chinese Yuan (CNY) nationwide, in an effort to boost business transactions with China and a further extension of China’s growing presence in the African continent and the intention to further develop the One Belt One Road Initiative (OBOR) across the region.

Bank Windhoek will accept denominations of 10, 20, 50 and 100 CNY at its branches with Yuan notes being traded in addition to the current range of foreign currency notes, which are exchanged at 0% commission. Travellers will be able to purchase Yuan up to 60 days before departure.

In further developments over the last two years, two other Namibian commercial banks, Standard Bank Namibia and First National Bank, have commenced the adoption of the Yuan by launching products that would cater to Chinese organisations intent on doing business in the country.

This new Yuan cash exchange solution was recently announced by the chief executive of Standard Bank, Vetumbuavi Munganda and the Chinese Ambassador to Namibia, Xin Shukang, whereby from the 1st February, Standard Bank facilitated the interchange and exchange of notes between the Yuan and the Namibian dollar.

From Standard Bank’s perspective, offering the exchange of these two currencies brings further convenience to their clients in addition to our international swift transfers and trade relations services.

In a further signal of the future expansion of the OBOR, trade between China and Namibia has significantly increased in the last few years with China now being Namibia’s sixth largest export market and Namibia’s exports to China in terms of value grew from N$939 million in 2011 to N$1.4 billion in 2013 and N$1.9 billion in 2014.

In further developments, beef exports from Namibia to China have recently commenced whereby the Ministry of Agriculture, Water and Forestry is deemed responsible for the inspection and quarantine of beef to be exported and the issuing of veterinary certificates.

Namibia’s relationship with China is also underpinned by their close ties with the Industrial and Commercial Bank of China (ICBC) which holds a 20% stake in the Standard Bank Group. This and similar agreements give a clear indication of the infrastructure being put in place to support growing trade and economic relations between China and Namibia. The rebirth of Africa will be a slow process but we are beginning to see sustainable progress in a number of nations across the continent.

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