Tunisia: Central Bank to introduce Chinese Yuan into currency reserves

Dec 02, 2016

This will reduce instabilities in Tunisian forex market

As recommended by the Monetary Policy Committee of Tunisia at the end of November, the Central Bank of Tunisia last Thursday unveiled its plan to introduce Chinese Yuan into Tunisian foreign currency reserves. The introduction of the Chinese Yuan will lead to a reduction in currency risks in the settlement of invoices of Tunisian importations from China, as importers will no longer be compelled to make payment in U.S dollars even though prices are set in Chinese Yuan by Chinese Suppliers. Currently, Tunisians are confronted with two currency exchange risk between the Tunisian dinar and the U.S. dollar on one side, and between the U.S. dollar and the Chinese Yuan on the other side. The uniformity between Tunisia's local currency and Chinese Yuan will minimize risk of floating dollar without influencing Tunisian importations. With this development, dollar and euro denomination transactions are expected to drop in banks and the instabilities of currencies at Tunisian forex market reduced.