On July 23 (local time in Pakistan), ICBC Karachi Branch officially announced the launch of RMB clearing mechanism at the RMB clearing business promotion meeting held in Karachi. Commercial banks in Pakistan and other countries in South Asia will be able to directly handle RMB business through the accounts opened in ICBC Karachi Branch in the future, significantly enhancing RMB transfer efficiency and facilitating RMB use. In early June, the State Bank of Pakistan approved ICBC Karachi Branch to launch the development of RMB clearing mechanism, and approved other local financial institutions to open RMB accounts in Karachi Branch.

At the promotion meeting in Karachi, experts from ICBC Head Office and Karachi Branch introduced the featured ICBC cross-border RMB clearing and financing products as well as Pakistani RMB clearing, cross-border RMB direct financing and other popular businesses to representatives of Chinese and Pakistani banks and enterprises. Officials from the Chinese Embassy in Pakistan, the Chinese Consulate General in Karachi, and the State Bank of Pakistan attended the meeting.

According to the General Manager He Shenghu of ICBC Karachi Branch at the meeting, the bilateral economic and trade cooperation between China and Pakistan is entering a new stage of development, gradually forming the cooperation in a wide field, at multiple levels and in all aspects and laying a solid foundation for the development of RMB business in Pakistan. ICBC Karachi Branch, the only Chinese commercial bank in Pakistan, began cross-border RMB business in the local place as early as in 2011, with its cross-border RMB settlement reaching RMB 92.9 billion in 2014. Since its establishment in 2011, ICBC Karachi Branch has been committed to expanding RMB business for local financial institutions and the State Bank of Pakistan. The approval of the establishment of the RMB clearing mechanism shows the strong interst of local regulators in cross-border RMB business and recognition in ICBC’s capabilities in RMB clearing business.

Located at the intersection of the overseas routes of “One Belt and One Road”, Pakistan is an important country in South Asia with the sixth largest population in the world. The China-Pakistan Economic Corridor, once linked up, can closely combine countries in South Asia, Central Asia, North Africa, and the Gulf through cooperation in economy and energy resources, and form an economic resonance. It can also strengthen the strategic position of Pakistan as a bridge connecting the Eurasian and African continents, which is significant to building “One Belt and One Road”. In recent years, the bilateral economic and trade investment between China and Pakistan has soared. Bilateral trade volume between the two amounted to USD 16,.006 mbillion in 2014, representing an increase of 12.57% year on year. In addition, China’s direct investment in Pakistan increased by 739.4% year on year, making it the largest direct overseas investment source country to Pakistan.

In terms of ICBC Group wise, with the increasing expansion of the RMB cross-border circulation and scope of use, the development of cross-border RMB business has entered the fast-track. Designated by the People’s Bank of China as the RMB clearing bank in Singapore, Luxembourg, Doha, Toronto, and Bangkok, ICBC has built a global RMB clearing business system. While the RMB transfer efficiency and convenient use are significantly enhanced worldwide, its clearing volume has continued to refresh records. In 2014, ICBC’s cross-border RMB business volume soared to a record high, exceeding RMB 3.5 trillion. Since the start of the pilot cross-border RMB business in 2009, ICBC has processed cross-border RMB business worth more than RMB 8 trillion, representing an average annual growth of over 200%.