eyes yuan, infrastructure deals on Li's Britain trip
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[June 12, 2014]
BEIJING (Reuters) - China's Premier Li
Keqiang will discuss infrastructure, high-speed rail,
nuclear and finance deals during a trip to Britain next
week, as well as London's role as an offshore yuan
trading hub, a senior Chinese official said on Thursday.
Li will meet with British Prime Minister David Cameron at his London
residence on June 17, a reciprocal visit following the British
leader's trip to China last year. Li will also go to Greece on the
June 16-21 trip.
British finance minister George Osborne opened the door to further
Chinese investment during a visit to Beijing last year.
He announced less stringent rules for Chinese banks operating in
London, in a push to make the British capital the main offshore hub
for trading in China's currency and bonds.
Osborne also paved the way for Chinese investors to take majority
stakes in future British nuclear plants.
Speaking to reporters ahead of Li's visit, deputy Chinese commerce
minister Gao Yan signaled further agreements would be signed.
"London has all along dedicated itself to becoming a renminbi
trading center. Relevant departments in China and Britain have had
proactive investigations into this," she said, using the formal name
for China's currency.
"On this visit to Britain by Premier Li I believe that there will be
positive developments on this issue, including on financial
cooperation," Gao added. "We will fully make use of London's
position as a financial center to further develop China's finance
China Construction Bank, China's second-largest lender, has been
selected to become the first clearing service for renminbi trading
in London, the Financial Times reported this week.
The internationalization of the yuan is one of China's most
ambitious and hotly debated reform projects. From less than 1
percent in 2009, nearly a fifth of China's trade is now settled in
The objective is to increase the usage of the currency for trade,
investment, and as a reserve currency, while lowering forex risk for
Chinese companies and reducing the country's exposure to U.S.
FREE TRADE DEAL TALK
There could also be agreements on energy, infrastructure and high
speed rail, Gao said, praising Britain's open attitude towards
foreign investment which she said was a "model" for the rest of
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"Britain has a sound legal system, a transparent oversight
environment. As long as companies accord with the law and the rules
and demands of the regulators generally, then investment and
business will have no barriers," Gao added.
She said that both countries should work to push for a
multi-billion-dollar free trade deal between Beijing and the
Cameron expressed his support for this when he was in Beijing in
December, riling the EU executive which rejected the move as
On the Greek leg of Li's trip, there will also be infrastructure and
energy agreements, and China will encourage Chinese companies to
participate in Greece's privatization program, Gao said.
She declined to provide details on any of the deals that could be
signed in Britain or Greece, saying it would be a "surprise".
China's Cosco Group and four other suitors have been short listed as
potential buyers of a majority stake in Piraeus Port Authority OLP,
Greek privatization agency HRADF said last week.
(Reporting by Ben Blanchard; Editing by Jeremy Laurence)
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