China, South Africa agree yuan clearing arrangement

BEIJING - The People's Bank of China (PBOC), the country's central bank, has signed a memorandum of cooperation with the South African central bank to establish yuan clearing business in South Africa.

The PBOC announced on Tuesday that it had signed the memo in South Africa and will later designate a bank to conduct yuan clearing there.

It did not specify when.

China hopes the arrangement will facilitate cross-border trade and investment between the two nation's companies and financial institutions using the Chinese currency, also known as RMB.

This will be the first yuan clearing arrangement in Africa.

RMB clearing abroad has become a major tool in promoting globalization of the RMB. Such business has been established in Hong Kong and Macao, as well as foreign cities including Singapore, London, Frankfurt, Seoul, Paris, Luxembourg, Doha, Toronto and Sydney.