BEIJING, April 8 (Reuters) - China took a step towards using the yuan to settle trade with Hong Kong and some other neighbouring trade partners on Wednesday, by naming five cities that will participate in the scheme.
The State Council, or cabinet, named Shanghai as well as four cities in southern Chinese province of Guangdong to start the trial scheme. Those four cities are Guangzhou, Shenzhen, Zhuhai and Dongguan.
The approval paves the way for municipal authorities to make specific arrangements for the launch of the programme, the general outline for which it unveiled in December.
"Carrying out yuan settlement in cross-border trade has significant meaning in promoting bilateral trade with neighbouring countries and regions," the State Council said in a statement on the government's web portal (www.gov.cn).
Yuan settlement would also help to prevent exchange rate risks and to promote stable trade growth, it added. (Reporting by Zhou Xin; Editing by Jason Subler)