Illustrative photo. (Source: dreamstime.com)Phnom Penh (VNA) – The Cambodia Rice Federation (CRF) and the National Bank of Cambodia (NBC) discussed ways to use the riel and the Chinese yuan in rice exports between China and Cambodia, Khmer Times newspaper reported on June 18.
The CRF also discussed with the representative of the NBC to promote the local currency for domestic consumption and transactions, Khmer Times quoted CRF vice president Chan Sokheang as saying.
He said all the transactions with the rice millers and farmers will use riel.
All rice exporters may soon have an alternative choice of payment either in US dollars or yuan. However, Sokheang said there were barriers to using the yuan for cross-border transactions previously, therefore, the discussions with the NBC were to resolve previous issues.
If Cambodia and China can trade with the riel and the yuan, the two countries will benefit from the exchange rate, Sokheang noted.
At present, exports of milled rice to China have been conducted in US dollars, but when the buyers sold the products in the Chinese market they get Chinese yuan. Then they exchange the Chinese yuan to US dollars to pay the Cambodia sides. Therefore, there is a loss on the exchange rate, he explained.
Sokheang said that for the first five months of the year Cambodia exported milled rice to China at a total value of 71 million USD. Therefore, the use of yuan and riel for the cross-border transactions will be beneficial for both traders – Cambodia and China – and they also enable the expansion of Cambodian milled rice to the Chinese market.
Long Vibunrith, deputy director of the NBC’s Exchange Management Department, said both sides agreed on the proposal to set up a memorandum of understanding (MoU) to begin transactions in yuan and riel at the meeting attended by the Chinese Central Bank, the NBC and commercial banks.
Vibunrith said that there might be an MoU signing ceremony during the Asia-Europe Summit in November, when the leaders of Cambodia and China meet each other./.
VNA
