So far, Industrial and Commercial Bank of China has served as the RMB clearing bank in 11 countries including Singapore, Luxembourg, Qatar, Canada, Thailand, Argentina, Russia, Laos, Kazakhstan, Pakistan, and Brazil, and is the commercial bank that has the largest number of RMB clearing banks in South America.
As the largest economy in Latin America, Brazil allows its own currency to be used for settlement in bilateral trade with China, which further confirms the global trend of "de-dollarization". Marcos Pires, director of the Institute of Economics and International Studies at Sao Paulo State University in Brazil, believes that the use of local currency settlements in trade and financing activities between the two countries is a very symbolic move and is "an important step forward towards the establishment of a fair international financial order."
Marcos Pires pointed out that after using the local currency for settlement, the export companies of the two countries no longer need to exchange the real or RMB into a third-party currency such as the US dollar, thereby avoiding additional transaction costs. "From a financial point of view, using the local currency Settlement can also create significant real and renminbi capital and facilitate direct investment.”
