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More than half of the country's imports of electronic products are settled in RMB.

Aug 02,2023

According to reports, in the second quarter of this year, more than half of Russia's imports of electronic products and home appliances were paid in renminbi, rather than mainly in dollars and euros as before.

A source close to a retail chain said that the proportion of imported electronic products paid in local currency is indeed increasing. Murtazin, chief analyst at Mobile Research Group, said that the proportion of RMB settlement from April to June this year exceeded that of the US dollar and the euro."The main advantage of renminbi payments is their transparency and predictability. Payments are quick and will not be rejected or delayed. External pressure from some national credit institutions cannot stop such transactions. In addition, the renminbi payment fee is reduced by about 2 percent due to savings in currency conversion fees," he said." According to Murtazin, quick and secure payments can ensure timely delivery of goods and help avoid shortages. In addition, the exemption of currency exchange fees has also contributed to the stability of electronic product prices to a certain extent. A company engaged in overseas procurement said that the rising proportion of RMB settlement is because foreign banks that Russian importers pay foreign exporters often refuse to accept payments in US dollars and euros, or conduct unnecessary lengthy reviews on them, freezing account funds for no reason.

A staff member of another importer said that the main advantage of RMB is the speed of remittance. Zalski, director of the Veta expert group, a consulting firm, believes that in the absence of European companies, Chinese goods will increasingly replace Western goods because they are easier to buy and relatively low prices. In this case, the share of RMB in Russian import settlement in the next two to three years is likely to reach 65%-70%, roughly equivalent to the sum of the euro and the US dollar in early 2022.

Experts believe that the speed of RMB remittance is fast, and in many cases the cost of RMB remittance is lower than that of US dollars and euros. As a result, analysts expect electronics prices to be more stable. Gusikov, director of public relations of the Russian Association of Home Appliance and Computer Traders and Manufacturers, believes that the proportion of RMB settlement is rising.

Peleperica, director of the Russian Federation Center for Financial Knowledge Methodology and associate professor at the World Financial Markets and Financial Technology Teaching and Research Section of the Plekhanov University of Economics in Russia, said: "It is worthwhile to invest in the RMB as a tool with two main characteristics: liquidity and growth potential. The RMB is becoming an increasingly liquid tool, and it may also have the potential to appreciate as foreign companies become more interested in RMB settlement." He said that RMB can be bought on the Moscow Exchange, and Russian banks and foreign banks can open RMB accounts or exchange RMB for cash.

Pereperica said: "The renminbi has sufficient liquidity and cash renminbi can be exchanged at airports, railway stations, banks and specialized exchange points in any country."

Milichakova, director of Russia's free financial global company, believes that it is possible to invest in RMB, but it is necessary to remember the risks inherent in any investment vehicle, at least market risks.

With the popularization of RMB trade settlement in the global market, the business of Chinese importers and exporters will become more and more convenient.

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