Ya start a thread, go away for a few years, and well...:coffee:
Good catch, escobar.
, By Zhou Xin and Kevin Yao,
Reuters, 5 May, 2012:
More at the link.
Not exactly good news, but then half a world away some people'd kill (so to speak) to have this kind of bad news...
welcome back
---------- Post added at 04:32 AM ---------- Previous post was at 04:27 AM ----------
Nigeria's central bank has added the equivalent of $500 million in Chinese yuan to its reserves and plans to buy seven times that amount, in a shift that underscores booming commerce between China and the African continent.
The bank will gradually increase its yuan holdings to 10% of its $35 billion in reserves, Central Bank of Nigeria Gov. Sanusi Lamido Sanusi said in an interview.
Over the past six months Nigeria has converted 1.4% of its reserves to Chinese currency, largely by selling euros and buying yuan on offshore markets in Hong Kong, Mr. Sanusi said. He said he plans to increase that amount by selling much of the bank's euro holdings and buying more yuan directly from the People's Bank of China.
Nigeria is courting China as a customer for its vast oil reserves, and Beijing recently invested in Nigeria-based rice processing plants and airport development projects, Mr. Sanusi said.
"As those kind of relationships improve, holding yuan would be very important," Mr. Sanusi said. He added that U.S. dollars would continue to make up the bulk of the bank's reserves.
Other African countries aren't likely to follow Nigeria's lead until China's currency—still not freely convertible—is more readily available on the open market, economists say.
"It is likely that we will see interest from the oil producers with larger external reserves first," said Razia Khan, head of Africa research for Standard Chartered Bank in London. "I am guessing it is a trend that will become far more important than it is currently, especially if China takes steps towards currency convertibility as has been hinted by 2015."
Ms. Khan said South Africa might also consider converting a portion of its reserves to yuan because China is it's largest single-nation trade partner.
Daniel Mminele, a deputy governor of South Africa's reserve bank, said the bank's reserves are dominated by dollars, euros and British pounds, and that the strategy is regularly adjusted according to criteria including South Africa's trading patterns.
"Any such review would include the role to be played by the Chinese yuan, given the growing trade links between South Africa and China," Mr. Mminele said.
Mr. Sanusi, Nigeria's central bank governor, said trade in yuan through the Hong Kong market was already liquid enough to protect the bank's investment. As Nigeria's government embarks on an ambitious plan to slash fuel subsidies and revamp Nigeria's dilapidated power grid and roadways, Mr. Sanusi said he didn't want to wait to diversify the bank's holdings.
"At the moment you've got huge global imbalances, huge surpluses in Asia. It is reasonable that countries should look into the possibility of tapping into those markets," Mr. Sanusi said. "We cannot afford to delay the infrastructure investments that we're doing."
