RMB Internationalization and How it can help your business
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Welcome to ChinaInvest.biz Magazine - September 2011 Issue

ChinaInvest.biz is the editorial division of Klako Group and will be providing insight into investment, tax and operational issues for foreign companies entering and expanding throughout China.

Since mid-2009 the Chinese government's Renminbi (RMB) Cross-Border Settlement Pilot Scheme has allowed companies trading with designated Chinese enterprises (Mainland Designated Enterprises) to settle transactions in RMB. China continues to make major steps to advance the pilot scheme and the gradual globalization of its currency. Whether a company is sourcing from or looking to sell to the China market there are now numerous advantages which can be gained and will be looked at in this article.

Should you require further information, please contact our Directors at our Group Headquarters and/or China Headquarters.

Labor Law is a relatively new phenomenon in China, with the first comprehensive law passed
in 1994. The new law, adopted by the National People’s Congress (NPC) on 29th June 2007,
looked to redress some of the poor working conditions found in China, particularly for the
average worker. Prior to the passage of this law, most Chinese employee’s in small-medium sized
firms lacked employment contracts. Morever, they were short-term, giving employers the flexibility to
frequently bring in a new, often cheaper hires whenever they saw fit.


RMB Internationalization and How it can help your business

The China market place appears to be evolving at a faster pace than originally envisaged by the People’s Bank of China (PBoC). Despite this, and the introduction of investment products in addition to trade-based activities, the bank still seems intent upon maintaining a process of gradual opening up of activity. In this respect, Hong Kong appears the ideal offshore pilot location as developments there can be readily managed by the respective regulators.

As the process of the RMB internationalization continues, there will be a need to ensure that locations where RMB transactions might take place have the necessary infrastructure to cope. This includes factors such as local clearing/regulatory infrastructure and the capabilities of banks operating in these locations. There are already nearly 100 major locations where RMB can be transacted in RMB immediately and without difficulty. For example, if a local shortage of RMB arose, it should be possible to quickly inject additional RMB liquidity via one of the clearing or participating banks.

To read the full article, please click here to view the magazine (PDF file)


If you require assistance with the above subject, please contact us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

All information in this report is verified to the best of our ability and is assumed to be correct at time of release; however, Klako Group does not accept responsibility for any losses arising from reliance on the information provided within.


Free Consultation with China and Hong Kong Legal & Tax Advisors


The directors of Klako Group will be travelling throughout the year to meet with partners and clients and to participate in trade and tax-related events. Should readers or clients of the firm wish to meet our directors face to face during their trips to discuss matters concerning China, Hong Kong and/or Singapore business investments, please contact us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . Appointments will be made on a first come, first serve basis. The visits of our directors provides an excellent opportunity to all our readers to discuss first hand their own investment potential, opportunities and legal/tax updated for China, Hong Kong and Singapore in detail.

 

Below is the tentative scheduling for 2011.

September 26th-30th 2011: Germany

October 12th-31st 2011: India, France, Turkey

November 29th-30th 2011: Hong Kong Forum

To view the full schedule, please click here (PDF file)