Paris bids for top spot in Europe's yuan business

French minister builds on success of leader's visit to Beijing with pitch for role as trading hub

PUBLISHED : Monday, 29 April, 2013, 12:00am
UPDATED : Monday, 29 April, 2013, 4:16am

France is keen to act as a hub for yuan trading in the euro zone as China pushes for its currency to be more widely used on the international stage, according to French Minister of the Economy and Finance Pierre Moscovici.

The minister spoke to the South China Morning Post on Friday during a visit to Hong Kong after he joined a delegation led by President Francois Hollande to Beijing.

Moscovici said France would be the most suitable location for an offshore yuan trading centre in Europe because many big international companies were based there.

"These large companies will be major players in a yuan offshore market. Several have already demonstrated a keen interest in settling their international trade and making investments in yuan," he said, noting that many French companies were also big issuers of so-called dim sum bonds - yuan-denominated bonds - in Europe.

China has not yet allowed the yuan to be fully freely convertible, but since 2009 it has allowed the currency to be used for settlement of international trade and investment.

Moscovici said Paris was a gateway for Chinese investors to enter Europe and other French-speaking countries in Africa.

Hong Kong also played a key role in the trade link between France and Asia.

The minister said French wine exports to Hong Kong were now 12 times what they were five years ago, and that France's overall exports to the city, including luxury goods and telecommunications products, had doubled in the past three years.

It is estimated that 70 per cent of French exports to Hong Kong are re-exported to mainland China and other parts of Asia.

"Many people only think of doing food and wine and luxury goods business with France," Moscovici said. "But in fact, France can offer many high-technology industry services such as Airbus, nuclear energy, and town planning for China."

Hollande became the first European leader to meet President Xi Jinping since the latter came to power last month. The two leaders pledged to deepen economic ties.

China signed a deal to buy 60 Airbus planes during the visit.

China Guangdong Nuclear Power and Electricite de France signed a co-operation deal on research into nuclear reactors and nuclear power plant maintenance and upgrading.

France is a leader in nuclear energy technology, generating 78 per cent of its electricity from nuclear power.