Taiwan-based Companies Making Increased Use of Offshore RMB
Taiwan-based companies are increasingly making payments and collecting receipts through offshore Chinese renminbi (RMB) accounts, according to the latest Bank of America Merrill Lynch (BoA Merrill)-SunGard Asia Pacific Treasury Management Barometer survey.
The survey, which is further confirmation of Taiwan’s importance as an RMB offshore centre found that 24% of polled treasurers in Taiwan are currently making payments and collecting receipts through an offshore RMB (CNY) account.
BofA Merill commented that as business ties with Taiwan evolve and China’s currency becomes more prominent in the global economy, research shows that Taiwan-based treasurers will further embrace CNY for both payments and receivables purposes. In addition to those respondents who do not currently make payments and collect receipts through a CNY account, 29% of Taiwan-based treasurers indicated that they are interested in and exploring opening a CNY account.
Significantly, the percentage of Taiwan companies making payments and collecting receipts through a CNY account is ahead of Asia Pacific’s other offshore RMB hubs, Hong Kong (23%) and Singapore (18%). The 24% of Taiwan companies utilising CNY is also significantly higher than the regional average of 16% and ahead of other peers in both China (20%) and Japan (17%).
“As treasury practices continue to evolve and business connections with mainland China further solidify, Taiwan treasurers will increasingly embrace CNY as a strategic currency for both payments and receipts,” said Kitty Yen, BofA Merrill’s head of treasury sales for Taiwan.
“Outside present and future expectations of broad RMB usage, the results of the inaugural Asia Pacific Treasury Management Barometer reveal that Taiwan companies are also amongst the region’s progressive as measured by cash visibility, account rationalisation and technology adoption.”
Among the other results of the survey, which canvassed over 900 treasurers and treasury professionals who were asked to identify business priorities, pinpoint market challenges and emerging trends.