At Mong Cai international border gate (Source: VNA) Hanoi (VNA) – A newly-issued circular on foreignexchange management is expected to promote border trade between Vietnam andChina.
According to Circular No 19/2018/TT-NHNN issued by the StateBank of Vietnam on August 28, which will take effect from October 12 this year,the Chinese yuan will be allowed for payment in the border areas between Vietnamand China.
Besides the yuan, traders and residents in the border areasof Vietnam and China, can also use Vietnamese dong or fully convertiblecurrencies, such as the US dollar, Euro or Yen, for payment of goods andservices.
In addition to individuals, some other organisations will besubject to the new regulation. They include commercial banks and branches offoreign banks licensed to conduct foreign exchange transactions in Vietnam;branches of banks located in border areas and border-gate economic zones ofViet Nam and China; organisations trading in duty-free goods; organisationsproviding services in isolated areas at international border gates;organisations engaged in bonded warehouses in border regions; the Vietnam-ChinaBorder Gate Economic Zone; and other organisations and individuals conductingpayment activities in Vietnam-China border trade.
Payment can be made through banks or in cash in dong or yuan,according to the circular.
Vietnam has seven provinces sharing the border with China,including Lang Son, Quang Ninh, Ha Giang, Lai Chau, Lao Cai, Cao Bang and DienBien. The Chinese yuan and Vietnamese dong are only used for payment in borderareas of these provinces.
Economic and trade cooperation between China and Vietnam has become increasinglyclose in recent years, and there is huge demand and an increasing trend towardyuan settlement in Vietnam.
Vietnam has overtaken Malaysia to become the largest tradepartner of China in the Association of Southeast Asian Nations (ASEAN). Their two-waytrade was estimated at 66 billion USD in the first half of 2018, with theaverage monthly trade turnover between the two countries having exceeded 10billion USD for the first time in history.-VNA
