* China researching how to let individuals settle trade in
* Considering how to enable settlement for travel,
* Will open new channel for yuan to flow into global markets
* Programme to be implemented by end of year
By Xiaowen Bi and Pete Sweeney
HONG KONG/SHANGHAI, May 6 China is looking into
how individuals and small businesses can settle trade using yuan
this year, a People's Bank of China official told Reuters on
Monday, potentially opening a massive new conduit for Chinese
currency to flow into global markets.
At the same time, by allowing individual traders and
companies, Beijing can help eliminate the risk of currency
fluctuation for individuals and small enterprises in the
Guo Jianwei, deputy director of one of two central bank
departments focused on monetary policy, said that regulators
were considering how to include provisions for travel, online
commerce and trade by small businesses.
"After several years of operation, yuan trade settlement by
corporations has matured; the next step is trade settlement for
individuals," said Guo.
"A pilot programme in Yiwu is already under way, and the
next step is to expand it throughout the whole country."
Yiwu is a small city in Zhejiang province that hosts a trade
expo centre that has become a massive platform for small private
businesses selling Chinese manufactures for export.
Guo's more detailed explanation of the programme to Reuters
followed similar comments he made at a conference in Guangzhou
The official China Securities Journal had previously quoted
a central bank spokesperson saying that Yiwu would be an area of
financial reform, including the removal of restrictions on
currency conversions, yuan trade settlement and an easing of
other related trade policies.
Chinese individuals are only permitted to exchange the
equivalent of $50,000 per year for use in overseas purchases or
investments, but many companies have managed to get around these
restrictions through trade.
(Editing by Jacqueline Wong)