BOC developing green finance in BRICS countries

Bank of China is actively developing green finance in BRICS countries, supporting Chinese companies expanding overseas and promoting the internationalization of the renminbi, also known as the yuan.

BOC, one of China's largest State-owned commercial lenders, has maintained a strong local presence and continuously enhanced its financial services in Brazil, providing sustained momentum for closer economic, trade and investment ties between the two countries.

As Chinese companies accelerate their global expansion and strengthen their international operations, BOC provides comprehensive financial services to support their entry into the Brazilian market and improve the quality of their overseas operations through credit support, business matchmaking and other means.

The bank has provided nearly 7 billion yuan ($1.04 billion) in credit lines to support agricultural companies such as Yuan Longping High-Tech Agriculture Co, COFCO and China Brasil Tabacos in expanding their operations in Brazil.

It has also issued letters of financing intent, performance bonds and bid bonds totaling about 8.6 billion yuan for a number of projects, including the 800 kilovolt ultra-high-voltage direct-current electricity transmission project in northeastern Brazil, which is solely invested, built and operated by the Brazilian subsidiary of State Grid Corp of China, and the Salvador-Itaparica Bridge, which is currently being constructed by Chinese companies.

To date, BOC has established partnerships with more than 300 Chinese enterprises operating in Brazil, providing a total of 11 billion yuan in credit facilities.

As a new wave of technological revolution and industrial transformation gathers pace, the global competitiveness of "Made in China" has risen significantly. To further support the development of new quality productive forces, BOC has provided companies including Chinese rolling stock manufacturer CRRC Corp Ltd, Xuzhou Construction Machinery Group and Guangxi Liugong Machinery Co with loans, factoring, financial leasing, account management and derivatives services to help them expand in Brazil.

The bank also provided a yuan-denominated loan for the Sao Paulo Metro Line 2 extension project, enabling the purchase of China's independently developed tunnel-boring machine and marking the first time that high-end Chinese manufacturing equipment has been exported to South America.

Meanwhile, BOC has issued letters of guarantee to Brazilian dealers purchasing Chinese-made vehicles from companies including BYD and Chery, helping Chinese private automakers expand their market share in Brazil.

The internationalization of the renminbi has played a crucial role in making financial services more convenient for businesses.

In recent years, BOC has actively explored cross-border use cases for the renminbi. It successfully processed a renminbi letter of credit discounting transaction for Eldorado Brasil, a leading pulp producer, and immediately converted the funds into Brazilian reais for crediting to the company's account. This marked the first time in the history of China-Brazil trade that a transaction achieved a complete closed loop covering renminbi-denominated pricing, settlement and financing, followed by the direct conversion of renminbi into Brazilian reals.

In 2023, Bank of China (Brazil) Ltd completed the first disbursement under a 560 million yuan loan for State Power Investment Corp's Brazilian subsidiary, marking the first yuan-denominated loan issued in the Brazilian market.

The bank also facilitated the first direct renminbi financing transaction between financial institutions in the two countries. Acting as lead underwriter and lead bookrunner, BOC assisted Suzano, a major global pulp producer, in issuing a green panda bond worth 1.2 billion yuan — the first panda bond issued in South America.

South Africa was the first African country to sign the cooperation documents on the Belt and Road Initiative with China and has remained China's largest trading partner in Africa for more than a decade.

Bank of China's Johannesburg branch is the largest Chinese financial institution with commercial operations on the African continent, with services covering more than 20 African countries and regions. In July 2015, China's central bank designated BOC's Johannesburg branch as the first renminbi clearing bank in Africa.

Guided by the goal of supporting China's new development paradigm and facilitating trade and investment, the branch has continued to strengthen its RMB clearing infrastructure while actively exploring business models and use cases for RMB services in Africa.

In 2025, its RMB clearing volume reached 630 billion yuan, a 552 percent increase from 2023. Currently, its RMB clearing network covers 16 African countries and regions.

BOC has also continued to innovate financing channels to support economic development in Africa. In June 2024, its Johannesburg branch successfully issued a three-year, $300 million bond. It was the first time a Chinese financial institution in Africa issued a floating-rate US dollar bond priced using the Secured Overnight Financing Rate.

The transaction marked another breakthrough in the African bond market, following the branch's issuance of Africa's first green bond led by a Chinese bank in 2022 and its assistance to the Egyptian government in issuing a 3.5 billion yuan sustainability panda bond — Africa's first panda bond — in China's interbank bond market in 2023.

Green development and energy cooperation are key areas supported by BOC in South Africa, which has long struggled with electricity shortages.

In 2024, PowerChina signed a contract for the Oasis 1 battery energy storage systems projects, which were tendered by the South African government. Once completed, the projects will be able to store 1,000 megawatt-hours of electricity, enough to meet the daily power needs of about 100,000 households.

Chinese companies have long found it difficult to participate in such energy projects in South Africa due to factors such as the deep-rooted presence of European and US companies in the country's energy sector and the lack of understanding among some international financial institutions regarding the business models and financial structures of Chinese companies.

Shen Hua, general manager of the trade finance department at Bank of China's Johannesburg branch, said the selection of PowerChina as the contractor was made possible in part by the financial support provided by BOC.

As the credit guarantor, the bank issued a letter of guarantee to the project owner in line with South African market practices to secure PowerChina's performance. This enabled the contractor to receive advance payments and proceed smoothly with construction, while helping the project owner mitigate risks and enhancing the professional image of Chinese companies in international projects, Shen added.