CBN reaches agreement with China’s ICBC on yuan

PMB and Xu Shaoshi, Chair of National Reform and Development Comm, at Opening Ceremony of China-Nigeria Business Forum in Beijing, China on April 12, 2016.

PMB and Xu Shaoshi, Chair of National Reform and Development Comm, at Opening Ceremony of China-Nigeria Business Forum in Beijing, China on April 12, 2016.

China’s Industrial and Commercial Bank of China Ltd (ICBC) , the world’s biggest lender, and Central Bank of Nigeria on Tuesday signed an agreement on yuan transactions, a Chinese Foreign Ministry official said.

“It means that the yuan is free to flow among different banks in Nigeria and the yuan has been included in the foreign exchange reserves of Nigeria,” Lin Songtian, director general of the foreign ministry’s African affairs department, told reporters.

The agreement is among the  six by the officials of both countries presided over by Presidents Xi Jinping and Muhammadu Buhari.

The agreements covered industrial activity, aviation and infrastructure investment cooperation between the world’s second largest economy and Africa’s most populous nation, which has struggled in the face of plunging oil prices and an $11 billion budget deficit this year.

CBN has said it plans to diversify its foreign exchange reserves away from the dollar by switching a stockpile into yuan, underlining the momentum behind Beijing’s drive to internationalise its currency.

“If there is demand from Nigeria, China is ready to further conduct financial cooperation,” Songtian,

Nigeria converted up to a tenth of its reserves into yuan five years ago. Now the government is considering issuing Panda bonds to help fund a record budget as Africa’s biggest economy suffers a slump in global oil prices which has slashed revenues.

Songtian said a framework on currency swaps has been agreed with Nigeria making it easier to settle trade deals in yuan.

China has currency swap deals with countries ranging from Kazakhstan to Argentina and New Zealand.

Beijing is deepening ties with Abuja, as it is with countries across Africa. It signed agreements to develop infrastructure and to cooperate with Nigeria. ICBC also signed agreements on manufacturing with Dangote group.



5 Comments
  • Hope the relationship between china and nigeria widens to open door for Nigeria’s macro economic development

  • saad

    May Allahhelp Baba Buhari, amin

  • musa aliyu

    Change!!! Whoever says this change is not good, should take the Obasanjo alternative. Nigeria shall be great again, God willing

  • Noble

    Those insulting Mr President the doors are open. Wail as you like but Nigeria shall be great again. Let see if this dollar madness will be cured. Sometime I wonder if our legal tender is still naira or dollar. If only Nigerians will switch to yuan for business, those that have stockpile dollar waiting for devaluation will be disappointed.
    God guild PMB
    God bless Nigeria.

  • Ikenna

    Welcome development. “Nigeria converted up to a tenth of its reserves into yuan five years ago…” then it stopped because the west wasn’t happy. This will further infuriate them (the point is economic war is the new empire war). The government should stand firm amidts coming trials (which are bound to come from you-know-who), because Buhari just like Jonathan has finally entered into the Western Europe-America vs Asia economic war. God bless Nigeria

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