The introduction of this local currency settlement aims to ease the import of goods such as vegetables, fruits, construction materials, and technology from China….reports Asian Lite News
The Maldives has announced steps towards establishing a Chinese bank in the country, alongside the implementation of a Free Trade Agreement (FTA) with China set to begin in September.
Maldives’ Minister of Economic Development and Trade, Mohamed Saeed, shared these developments at the ‘Maldives-Sichuan Trade and Investment Cooperation Conference.’
Saeed emphasized the economic potential of the FTA, which will include a ‘local currency settlement’ system allowing Maldivian businesses to trade with China using the Maldivian Rufiyaa and Chinese Yuan instead of USD.
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Saeed noted that laws have been passed to facilitate this arrangement, and an agreement between the People’s Bank of China and the Maldives Monetary Authority is underway.
The introduction of this local currency settlement aims to ease the import of goods such as vegetables, fruits, construction materials, and technology from China.
The Maldives imports approximately USD 700 million worth of goods from China annually, including USD 19 million from Sichuan province.
The conference, attended by over 100 participants from both regions, sought to strengthen business relations and inform Chinese companies about investment opportunities in the Maldives.
Additionally, the Maldives is exploring a similar currency arrangement with India.
This initiative follows a visit by Maldivian Foreign Minister Moosa Zameer to China in July, amid cooling relations between the Maldives and India since the election of pro-China President Mohamed Muizzu.
President Muizzu’s government has already taken steps to reduce India’s military presence in the country.
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