A cross-border trade and investment forum was held in Phnom Penh on Oct. 24. An official of the National Bank of Cambodia said that the Cambodian government is encouraging its people to use renminbi in cross-border trade and investment with China.
Neav Chanthana, deputy governor of NBC, said that 17 banks in Cambodia are now engaging in renminbi clearing business, four banks accept renminbi deposits and Chinese tourists can pay with renminbi in the country.
"Approving the use of renminbi can provide Cambodia with further advantages in attracting Chinese tourists and investment," Chanthana said.
The renminbi-riel regional transaction was initiated in September in the inter-bank markets.
Chanthana pointed out: "promoting renminbi-riel transactions is part of the Cambodian government's efforts to support the construction of the Belt and Road. This move can strengthen economic and financial connections between the two countries, lowering risks related to exchange rates."
Tao Nenghong, deputy general-manager of the international business department of the Industrial and Commercial Bank of China, said that Cambodia is an important country along the Belt and Road routes, and the robust growth in bilateral trade and investment and the direct transactions between the two currencies can effectively lower the transaction costs and the exchange rate risks.
Renminbi's internationalization has made concrete progress in Cambodia. Cambodia's central bank now incorporates renminbi as part of its foreign exchange reserve portfolio. The central bank not only has renminbi deposits, but also buys renminbi bonds. Renminbi is now circulating in large cities such as Phnom Penh, Siem Reap and Sihanoukville. More and more businesses accept renminbi in their daily operations, according to Chen Changjiang, chief of the Bank of China's branch in Phnom Penh.
China is Cambodia's largest trade partner and source of tourists. It is estimated that Chinese tourists will make 1 million trips to the country this year.