The Cambodian central bank has provided additional details on the use of Chinese currency-backed settlements for cross-border commerce.
At a press conference on Tuesday, it said the additional details were to clarify a misunderstanding in media reports.
The clarification comes a week after the Bank of China (Cambodia) held a forum of Renminbi attended by senior officers from the National Bank of Cambodia (NBC).
Some media outlets [not The Post] had reported incorrectly that the term “settlements for cross-border commerce” meant that the yuan would be used in the Kingdom’s daily business transactions.
Speaking to reporters yesterday, NBC’s director general Chea Serey said its approval to use the yuan for cross-border commerce did not necessarily mean the NBC wants to push the yuan for settlements in retail business transactions.
She said it actually meant that Cambodian and Chinese businesses are allowed to conduct trade settlement activities by using the yuan or riel directly via banking services when there are cross-border trades.
“Cross-border traders can avoid using the US dollar and thus prevent exchange risks."
“What we want to promote is that Chinese traders can use yuan to convert to riel as settlement with Cambodian traders."
“Once Chinese investors exchange yuan for riel, the demand for riel will increase as well and this indirectly promotes the currency’s use,” she said.
Bilateral trade between Cambodia and China still relies very much on the greenback.
According to NBC figures, Cambodia imported Chinese goods valued at $5.2 billion last year. The yuan was used for only $130 million of this amount, the rest was paid in US dollar. Of Cambodia’s $753 million in exports to China, only $70million was paid in yuan.