UAE Central Bank building in Abu Dhabi. Image Credit: Gulf News Archives

Abu Dhabi: The UAE Central Bank said on Wednesday that a currency swap between China and the UAE is going well and that transactions between the two countries are up 13 per cent year on year.

“It is going very well and we can do more,” said Mubarak Rashid Al Mansouri, UAE Central Bank governor, as he addressed reporters in Abu Dhabi on Wednesday.

The UAE Central Bank also plan to hold workshops between stakeholders of both sides for awareness purposes.

The currency swap deal was signed in 2015.

In a statement on Tuesday, the UAE central bank said it cleared transactions worth $7.01 billion (44.57 billion yuan; Dh25.74 billion) from January up to November 2018 through the Renminbi Clearing Centre in the UAE. The centre was launched in May 2017 to boost trade between the two countries.

“Renminbi clearing has become increasingly important as the UAE and Chinese governments deepen their cooperation to further the ‘Belt and Road Initiative’ and work towards establishing sustainable trade and investment partnerships,” a statement said.

The UAE and China are working closely in various sectors including energy, shipping, and banking, among other things.

Chinese firm Cosco Shipping Ports opened a container terminal at Khalifa Port this week with an investment of Dh1.1 billion. Chinese companies are also investing in a big way in Kizad.

The UAE also signed currency swap agreement with India last week during the visit of the Asian country’s External Affairs Minister Sushma Swaraj to Abu Dhabi to boost ties between the two countries.

On the India-UAE currency swap deal, Al Mansouri said their expectations are similar to those of the China deal.

“They are two important countries, once the mechanism is in place, it will facilitate more trade with the UAE and through the UAE to the entire region.”

The currency swap deal with India is for an amount of Dh2 billion or Rs35 billion, depending on which of the two central banks is requesting the amount, according to the Indian embassy.

The agreement is expected to reduce the dependency on hard currencies such as US dollar while giving the local currencies of the two nations a needed boost.