The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.
Canada has been designated a trading hub for China’s currency. What does it mean in terms of jobs, the economy and international trade?
Canada has been designated a trading hub for China’s currency, a move aimed at boosting international business between the two countries while also nudging China’s once cloistered “redback” toward global status.
Among other things, it means for the first time, Canadians can open bank accounts in Canada that contain China’s yuan, also known as the renminbi (RMB).
Canadian institutional investors, such as pension funds, will also be able to buy up to 50 billion yuan worth of Chinese bonds and stocks directly. That’s roughly $9.2 billion.
The deal will “continue to boost the Toronto region’s status as a global financial centre,” Janet Ecker, president and chief executive officer of the Toronto Financial Services Alliance, said in a statement.
But the main reason Canada sought the deal was to encourage Canadian business to trade more with China, the world’s fastest-growing and second-largest economy.
“What this is, hopefully, is a wakeup call to Canadian business to do more trade with China,” said Jason Henderson, head of global banking for HSBC Canada. Instead of being 21st on China’s list of trading partners, he said, Canada should be closer to 10th or 12th based on the relative size of the economy.
Both Harper and central bank governor Stephen Poloz have urged Canadian business to expand their international trade efforts, both to reduce Canada’s dependence on the U.S. economy and also offset sluggish domestic demand. How fast and how much of that actually happens will depend on how good a job the banks do of selling the idea to Canadians.
“Our next step is to get out and explain this to our customers,” Henderson said. The Canadian Chamber of Commerce has estimated the hub could boost Canada’s exports to China by as much as $32 billion over the next decade.
For the rest of this article, click here: http://www.thestar.com/business/economy/2014/11/10/what_does_a_rmb_trading_hub_means_for_canada.html