Pakistan has sound regulatory framework to support use, investment of RMB: central bank official

ISLAMABAD, Nov. 26 (Xinhua) -- Pakistan has established a comprehensive regulatory framework to support the use and investment of the Chinese currency renminbi (RMB), a senior official of the State Bank of Pakistan (SBP) said on Tuesday.

Muhammad Malik, executive director of the SBP, made the remarks while addressing an event in Karachi to mark the 10th anniversary of the RMB internationalization in Pakistan. The event was hosted by the Karachi branch of the Industrial and Commercial Bank of China (ICBC), which serves as the RMB clearing bank in Pakistan.

Malik said the RMB has great potential in Pakistan and is expected to benefit all stakeholders further, noting that the country already has a sound regulatory system in place to facilitate RMB usage and investment.

The SBP has rolled out multiple initiatives to promote RMB awareness, strengthen clearing and settlement capacity, and ensure that local enterprises and banks fully understand the advantages of conducting transactions in RMB, he added.

In an online address, Zhou Yongkun, head of the Macroprudential Policy Bureau of the People's Bank of China (PBOC), said RMB receipts and payments for China-Pakistan goods trade reached 19.4 billion yuan (about 2.73 billion U.S. dollars) in 2024, accounting for 23 percent of total cross-border receipts and payments in goods trade during the period.

He added that there remains broad room for future growth and that the PBOC will continue to enhance policy support for the RMB clearing bank.

Speaking at the event, ICBC Vice President Zhang Weiwu said the bank has opened RMB accounts for all 22 mainstream Pakistani banks authorized for foreign exchange operations, noting that RMB business in Pakistan has shown strong momentum.

He said ICBC will further increase resource input, explore ways to provide stable liquidity support for the offshore RMB market, and study the launch of more innovative RMB products to better meet the financial needs of market participants engaged in China-Pakistan economic and trade cooperation.

Yang Yundong, Chinese consul general in Karachi, said the evolving global economic environment underscores the importance of deepening financial cooperation between China and Pakistan.

China stands ready to work with Pakistan to facilitate local-currency settlement in bilateral trade and investment, expand RMB-related services, strengthen regulatory communication and coordination, and leverage financial technologies to enhance cross-border financial connectivity, he added.

In November 2022, the PBOC authorized ICBC's Karachi branch to serve as Pakistan's RMB clearing bank.