Business / Markets

Bank of China eyes yuan clearance in Prague

By Jiang Xueqing (China Daily) Updated: 2014-10-28 07:26

Bank of China Ltd is planning to open its first branch in Prague, the capital of the Czech Republic, to promote the setting up of a yuan clearing system in the country and help it develop an offshore yuan business.

Tian Guoli, chairman of Bank of China, told a China-Czech Business Forum in Beijing on Sunday that China's outbound investment is expected to exceed $500 billion over the next five years, and part of that could be used to provide financial support to infrastructure construction and other major projects in the Czech Republic.

He said the two countries had huge potential areas of cooperation: China offers a large market in retail consumption, natural resources and environmental protection, while the Czech Republic offers advanced technologies in fields such as biomedical sciences, environmental protection and brewing.

Bank of China already has strong business and investment links with the eastern European nation. In 2013 it helped finance the CZK63.6 billion ($2.9 billion) acquisition by PPF Group - a Czech-based financial and investment group - of a 65.9 percent stake in the country's leading mobile operator Telefonica CR, from Spain's Telefonica.

Tian said the bank is still actively engaged in several other Czech investment projects.

"We can provide a package of services including consulting, financing and risk control to Chinese and Czech entrepreneurs.

"To make a greater contribution to bilateral financial and investment cooperation, we will continue to make every effort to support Czech companies to explore the Chinese market and serve Chinese companies wishing to invest in the Czech Republic," Tian said.

China-Czech bilateral trade was worth $17.38 billion last year.

The Czech Republic is viewed as providing good investment opportunities as it excels in traditional sectors such as industrial design, machinery manufacturing, automobile manufacturing and tourism. China, on the other hand, can provide Czech companies a huge consumer market, and strong technology export potential.

Jiri Smejc, CEO of Home Credit Group, a Czech mass-market consumer finance provider, described China as one of its most important markets worldwide.

Home Credit Consumer Finance Co Ltd was launched in Tianjin in 2010 to offer consumer credit services on a range of products, allowing customers to pay for goods in installments or take out cash loans to finance their purchase of everything from durable goods to education and holidays.

Smejc told the forum it plans to expand its business into 300 Chinese cities over the next two years.

By June 2014, Home Credit China was represented in more than 150 cities in 14 provinces, stimulating domestic demand worth 25 billion yuan ($4 billion) and serving 6 million customers, he said.

Bank of China eyes yuan clearance in Prague

Bank of China eyes yuan clearance in Prague

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