China and Brazil completed a full and closed operation in the local currency of both countries for the first time.
This was announced by the Chinese Embassy in Brazil, according to the Chinese channel “CGTN”.
On September 28, the Bank of China (Brazil) successfully handled the renminbi letter of credit for the debit business of “Eldorado Brasil”, a Brazilian pulp company.
The transaction was immediately converted into Brazilian real and added to the account, marking the first fully-fledged closed transaction in the history of Sino-Brazilian trade, including renminbi pricing, settlement, financing and direct exchange with the Brazilian real.
The implementation of trade in the local currency indicates a move away from traditional business practices, which rely heavily on internationally recognized currencies, such as the US dollar, and by conducting transactions in their currencies, China and Brazil, the founders of the “BRICS” Alliance, aim to strengthen economic relations, reduce currency exchange risks, and enhance trade efficiency.
Last March, China’s vice minister of Commerce announced that his country had signed an agreement with Brazil on bilateral trade in Chinese yuan aimed at expanding cooperation in the food and mining sectors.
