UPDATE 1-China says yuan's use in trade growing quickly

Published 12/06/2010, 07:05 AM
Updated 12/06/2010, 07:08 AM

* June-Nov yuan trade settlements jump to $51 bln

* Exporters involved in the business totalled 67,359 (Adds details, background)

BEIJING, Dec 6 (Reuters) - Trade transactions settled in Chinese yuan totalled 340 billion yuan ($51 billion) between June and November, the People's Bank of China said on Monday.

China launched a pilot scheme of allowing companies to settle cross-border trade in yuan in July 2009 and expanded it in June.

The amount of yuan settlement in the past six months was more than seven times the total level at its initial stage and well satisfied the demand of companies in the business, the central bank said in a statement on its website (www.pbc.gov.cn).

The figure suggests that the pilot programme, allowing firms in some parts of the country to denominate their trade with companies in Hong Kong and some other trade partners in yuan, is growing faster than expected.

A total of 67,359 companies had already participated in yuan trade settlements, it said.

"The expansion of exporters to 67,359 from 365 in the trial programme will further push ahead the development of yuan settlement in the exports of goods, and facilitate trade and investment,"the central bank said in a statement.

The programme was heralded as a step towards internationalising the currency and eventually leading to China's relaxation of capital controls.

China, under pressure from the United States and other countries to let the yuan rise in value, seeks to increase the yuan's use in foreign trade to reduce the dollar's dominance. (Reporting by Kevin Yao and Langi Chiang; editing by Stephen Nisbet) ($1=6.662 YUAN)

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