(MENAFN - The Peninsula) The Middle East's first hub for clearing transactions in the Chinese yuan is to open in Doha in April, Qatar Central Bank (QCB) Governor H E Sheikh Abdullah Saoud Al Thani told the annual MEED Qatar Projects Conference. He said that the move is part of a programme of initiatives involving China that include action to support Qatari conventional and Islamic banks to increase their participation in the Chinese economy.
Industrial and Commercial Bank of China's Doha branch was appointed as the clearing bank for yuan deals in an agreement signed in November. QCB says the appointment of the Renminbi clearing bank will increase the strong ties between China and Qatar and position Qatar as the regional centre for Renimbi clearing and settlement.
Since 2011, China has appointed clearing banks for Taiwan, Singapore, London, Frankfurt, Paris, Luxembourg and Seoul. A clearing bank can handle all parts of a transaction.
Qatar is the biggest supplier of liquefied natural gas to China. Bilateral trade with China rose to QR41.9bn ($11.5bn) in 2013.
Al Thani said that Qatar has signed a 35bn yuan ($5.7bn) currency swap deal with China. The deal allows the central bank to swap currencies if needed to ease trade and investment, and could be used to diversify the Gulf central banks' foreign reserves, bankers say.
Addressing one of the sessions, Qatar National Bank's CEO Ali Al Kuwari said the growth rate of the Qatar economy will accelerate in real terms despite the fall in oil prices since the summer of 2014.
"The government is committed to its investment programme in line with the Qatar National Vision 2030 and the FIFA World Cup final plan," Al Kuwari said.
"Qatar has ample external and fiscal buffers to withstand the temporary drop in oil prices. Therefore, the investment programme is unlikely to be impacted by lower oil prices and public investment should continue to drive strong non-hydrocarbon real GDP growth."
QNB, which is the largest bank in the Middle East and Africa, forecasts that the total assets of the Qatar banking system will rise to $380bn in 2017 from $278bn in 2014. Total deposits are forecast to rise to $231bn in 2017 from $165bn last year.
Al Kuwari said that QNB forecasts that total lending by Qatari banks will grow at a compound annual growth rate of 10 per cent to $129bn in 2017 from $180bn in 2014.
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