The South African bank RMB has announced the renewal of its partnership with China Construction Bank (CCB) for another five years. The collaboration, which started in 2009, aims to facilitate trade and investment between China and Africa by leveraging the strengths of both banks.
RMB, the corporate and investment banking arm of FirstRand Limited, has been instrumental in supporting various Chinese enterprises in their activities in Africa, while CCB, the second-largest bank in China and one of the largest listed banks in the world, has provided financing and expertise to African businesses.
According to RMB CEO Emrie Brown, the partnership has enabled the two banks to facilitate over R20 billion of trade and provide over R6 billion of financing to Southern African companies. CCB was also an anchor funder of RMB’s R3.37 billion BEE refinancing deal in 2010.
The partnership comes when China-Africa trade is growing rapidly despite the challenges posed by the COVID-19 pandemic. According to data from China’s General Administration of Customs, bilateral trade between China and Africa reached $280 billion in 2022, up 13.5% year-on-year. China has remained Africa’s biggest trading partner for 15 consecutive years.
One of the benefits of the partnership is the promotion of renminbi (RMB) trade settlement, which can lower transaction costs and diversify foreign currency requirements for both Chinese and African businesses. Erwin Pon, Head of RMB Asia, said that more clients are settling import and export deals directly in the renminbi without first converting rands to US dollars.
The partnership also focuses on jointly supporting customers within the China-Africa corridor and expanding their cooperation in project financing, syndicated loans, and trade. Meiwei Luo, General Manager of CCB South Africa, said the trust established during the collaboration will be further leveraged to meet clients’ needs.
The partnership also explores various initiatives to allow the two banks to provide better client service. The parties have also committed to collaborate in activities and events across the China-Africa corridor to create brand awareness for both parties in Africa and internationally.
The partnership between RMB and CCB is an example of how banks can work together to enhance trade and investment between China and Africa, benefiting both sides and fostering economic development in the region.
Source: TechFinancials
