BRICS To Convert US Dollar Loans Into Chinese Yuan
BRICS member Ethiopia is in talks with China to convert its $5.38 billion worth of loans from the US dollar into the Chinese yuan. Ethiopia owes China $5.38 billion and plans to settle the payments in yuan-denominated loans. The move would bolster the local currency, giving it more strength in the forex markets. Eyob Tekalign, Ethiopia’s central bank Governor, is in discussions with BRICS member China for a potential swap to pay off loans in the Chinese yuan. Paying in the yuan-denominated loans helps Ethiopia save millions in foreign exchange rates. Paying in the US dollar is a costly affair, and converting the payments to yuan is cheaper. For context, BRICS member India saved close to $7 billion in foreign exchange rates for procuring oil in local currencies. Also Read: What The BRICS Currency Union Means for the US Dollar and Markets BRICS: US Dollar Loans To Be Converted Into Chinese Yuan Source: kitco.com / Shutterstock China is making all moves to internationalize the Chines...