In February this year, a multinational company based in Europe told Standard Chartered Bank it absolutely would not be trading in renminbi. In July the bank received a panicked phone call asking it to set up renminbi accounts, and quickly, as the company’s Chinese suppliers would no longer accept payment in dollars.
Very soon, all companies trading with China will have a “renminbi moment”, when they realise that the internationalisation of the Chinese currency is not a matter of long-term strategising, but something on which they have to act here and now. The rise of the renminbi heralds a major change in the global financial system and is happening much faster than people think, with new roles for global corporates, banks and financial centres being thrashed out at breakneck speed.
Even as pundits continue to weigh up the renminbi, debating the ‘ifs’ and ‘buts’ and worrying about market bubbles and slowing Chinese growth, the currency is being adopted apace, driven by real business demand. For many companies, the renminbi now represents an urgent challenge. If they fail to grasp the pace of change – and the opportunity that goes with it – it could be at the expense of their business.