Australia is holding preliminary talks with Hong Kong and Beijing about establishing an offshore yuan market in Sydney to serve the demands of growing Sino-Australia trade and boost the currency's global standing.
The move came after London and Singapore announced plans to launch their own yuan trading centres. It also coincides with yesterday's announcement that Beijing will further develop the offshore yuan market in Hong Kong as part of a new package of policies to mark the 15th anniversary of the handover.
Hong Kong was picked by the central government in 2009 as the first proving ground to settle cross-border trade in yuan outside the mainland market.
People familiar with the matter said officials in Hong Kong and Beijing had so far been co-operative with Australia over the move.
'The Chinese side has made it clear to Australian officials that although London has launched the first offshore yuan market outside Hong Kong, it doesn't necessarily mean London has the exclusive right to do so,' said one of the people, who declined to be identified as he was not authorised to speak to the media.
'I think Beijing wants to see some competition [among different offshore yuan centres] that will help boost trading volume and thereby increase the importance of the yuan potentially as a new global currency.'