China has launched several pilot Renminbi programmes over the years and the pace has quickened since the onset of the global financial crisis. Programmes introduced by China in the last 12 months, intended to enhance the international use of the Renminbi, included: • yuan-denominated cross-border trade settlement and trade financing; • yuan bonds issued by policy banks; and • currency swaps. Recently, China launched a Renminbi sovereign bond issue worth 6 billion yuan (US$878.5 million) in Hong Kong and this marked the key milestone in the internationalisation of the Renminbi. Holders of the Treasury bonds will enjoy guaranteed interest of between 2.25% to 3.3% depending on the terms subscribed. The sale of the bonds is expected to end on 20 October 2009. Given the impact of the global financial crisis, prudent investors are increasingly favouring demand for sovereign bonds issued by a strong economy like China, compared with the corporate bond market. Prior to the...