Vietnamese exporters expected to benefit from RMB's SDR inclusion

Vietnamese exporters are expected to benefit from the Chinese currency renminbi (RMB)'s inclusion into the elite reserve currency basket of the International Monetary Fund (IMF).

On Saturday, IMF officially added the RMB to its new Special Drawing Rights (SDR) basket as a fifth currency, along with the U.S. dollar, the euro, the Japanese yen and the British pound.

According to Vietnam Textile and Apparel Association, the sector carries out numerous transactions with China while importing garment and textile materials. The inclusion of the RMB into the SDR basket will have impacts on the sector, Vietnam's state-run news agency VNA quoted the association as saying on Monday.

Nguyen Van Thoi, chairman of the Managing Board of Thai Nguyen Garment Company, said the inclusion will be favorable to local companies as currently many Vietnamese garment and textile companies purchase materials from China.

From now on, they will not have to make currency exchange from the U.S. dollar into RMB while carrying out such transactions, said Thoi.

When the RMB is used as an international means of payment like the U.S. dollar, the euro, the Japanese yen and the British pound, its exchange rates will be stable, which will facilitate business and trading activities of Vietnamese companies, Thoi assessed, adding that the inclusion offers a positive signal for those who have transactions with the Chinese side.

Echoing Thoi, Chu Xuan Ai, director of Ton Vinh Trading and Technology Development Company Limited, whose major is exporting tea products, told VNA that exporting companies like his may get benefits from the RMB's inclusion as they will not have to transfer the money into U.S. dollar for payment while it will help stabilize the exchange rates.

Sharing the same view with other companies, Nguyen Thi Thu Hien, managing director of Vietnam's Hanoi Trade Corporation (Hapro), which specializes in exporting, importing and retailing consumer goods, said on VNA Monday that to those who conduct trade activities with China, the inclusion of RMB in the SDR will make the exchange rates of RMB against U.S. dollar and other currencies more stable.

Vu Huy Dong, general director of Damsan Textile Joint Stock Company, said the RMB's inclusion has symbolic significance and brings the value of RMB to world-class level.

Source : XINHUA