BEIJING -- Asia and Europe should build a new framework of investment and financing for the "Belt and Road" initiative, proposed by Zhang Monan, associate researcher at the China Center for International Economic Exchanges.
Asia and Europe should promote financial cooperation and integrated development, which can not only effectively reduce financing costs, enhance efficiency in the whole financial system, but also offer strong and efficient investment and financing guarantees for development of the "Belt and Road" initiative in the region, said Zhang.
Zhang noted that with many European countries joining the Asian Infrastructure Investment Bank (AIIB), China also officially became a member of the European Bank for Reconstruction and Development (EBRD) in January, 2016, strengthening the comprehensive strategic cooperation under the framework of "Belt and Road" (B&R) between China and Europe.
Apart from the financing platform, accommodation of funds is the important support for construction of the "Belt and Road". While carrying out multilateral financial integration by means of syndicated loan and bank credit extension, it is the most important to choose the proper financing tool. The bond financing is a financing tool fit for the infrastructure investments. The new-type development financial institutions represented by the AIIB and the BRICS Development Bank happen to become the most suitable financing body to promote development of the Asian and European bond markets, according to Zhang.
At present, the RMB internationalization is underway and China is quickening the pace of promoting cross-border use of RMB.
Since 2008, signing of the currency swap agreements between central banks has become increasingly frequent and the new type financial structure based on the current swap network is becoming a trend.
Data shows that by the end of 2015, China's central bank had singed the bilateral currency swap agreements with 33 central banks and monetary authorities with the amount already exceeding RMB3.3 trillion. In addition, nearly 15 offshore RMB clearing centers have been built on a global scale.
Since 2014, China has already signed the RMB clearing agreements with Britain, Germany, Luxembourg, and France. Meanwhile, China also granted Britain, Germany and France each RMB80 billion of RMB qualified foreign institutional investors quota. Plus the currency swap currency under the China-Switzerland free trade agreement (FTA), a RMB currency swap network in Europe is taking shape, said Zhang.
A single purchase
