Don’t be fooled by the the Renminbi (RMB) modest #5 ranking in global payments and 1.88% share. The global numbers are dominated by the USD, EUR & GBP payments between USA & Europe.
Focus instead on what is happening along the Belt & Road Initiative (BRI) between Asia, Africa and Europe. This is how China is expressing its global ambition with infrastructure, trade and political connectivity along a vast historic trading route.
The SWIFT special edition RMB tracker June 2019 clearly illustrates how RMB is the oil that lubricates the BRI. Snapshot of RMB usage growth:
Europe (2014-2018) - Hungary, Turkey and Uzbekistan saw increases of 242%, 35% and 170% respectively
SEA (2014-2018) - Singapore has experienced payment traffic growth with China of 231%. Thailand, Vietnam and Indonesia also growing strongly;
Africa (2016-2019) - The total across all currencies shows an increase of 28%. But, during the same period, the proportion of RMB used for payments increased by 123%
The BRI is paved with RMB…