 A man walks past a HSBC Holdings logo at the bank's China head office in Shanghai, China, in this file photo. Converting lira into yuan will cut foreign-exchange transaction costs for Turkish companies doing business with China significantly. Bloomberg photo |
HSBC Holdings plans to start spot trading between the yuan and the Turkish Lira in March as China boosts the international role of its currency.
Converting lira into yuan will cut foreign-exchange transaction costs for Turkish companies doing business with China by 5 percent to 7 percent compared with dealing in dollars, Virma Sökmen, head of corporate banking at HSBC in Turkey, said at a news conference in Istanbul Tuesday.
“China-Turkey trade is moving towards $50 billion," Sökmen said. "We could not simply watch this trend."
Yuan spot trading began versus the Russian ruble and Malaysia’s ringgit last year. China also allowed offshore trading of the currency in Hong Kong and opened its bond market to foreign banks.
Turkish exports to China grew to $2.1 billion in the year to November 2010 from $1.6 billion for full-year 2009. Imports expanded to $15.3 billion from $12.7 billion in the same period. The yuan could be one of the three most-traded currencies in a few years and China will conduct more than half of its foreign trade in yuan in 2015, to the value of $2 trillion, HSBC said in a statement.
Turkey is trying to deepen ties with emerging markets at a time when its talks to enter the European Union have stagnated, said Simon Quijano-Evans, chief economist for emerging Europe, the Middle East and Africa at Credit Agricole Chevreux in Vienna.
“We can go back a long time all the way to the silk roads, to a tradition before where Turkey, China and India were trading on a larger scale,” Quijano-Evans said.
HSBC Turkey has a correspondent bank agreement with HSBC China, which gets the yuan from China’s central bank.
Converting lira into yuan will cut foreign-exchange transaction costs for Turkish companies doing business with China by 5 percent to 7 percent compared with dealing in dollars, Virma Sökmen, head of corporate banking at HSBC in Turkey, said at a news conference in Istanbul Tuesday.
“China-Turkey trade is moving towards $50 billion," Sökmen said. "We could not simply watch this trend."
Yuan spot trading began versus the Russian ruble and Malaysia’s ringgit last year. China also allowed offshore trading of the currency in Hong Kong and opened its bond market to foreign banks.
Turkish exports to China grew to $2.1 billion in the year to November 2010 from $1.6 billion for full-year 2009. Imports expanded to $15.3 billion from $12.7 billion in the same period. The yuan could be one of the three most-traded currencies in a few years and China will conduct more than half of its foreign trade in yuan in 2015, to the value of $2 trillion, HSBC said in a statement.
Turkey is trying to deepen ties with emerging markets at a time when its talks to enter the European Union have stagnated, said Simon Quijano-Evans, chief economist for emerging Europe, the Middle East and Africa at Credit Agricole Chevreux in Vienna.
“We can go back a long time all the way to the silk roads, to a tradition before where Turkey, China and India were trading on a larger scale,” Quijano-Evans said.
HSBC Turkey has a correspondent bank agreement with HSBC China, which gets the yuan from China’s central bank.
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