As explained in a brief communiqué, the agreement will facilitate the operations of companies and financial institutions of both countries, as well as bilateral trade and investments.

This pact gives greater strength to the yuan or renminbi, which in recent years has gained increasing importance as an alternative currency in international business in the face of the proliferation of US restrictions on the use of the US dollar.

Last year, China sealed a similar agreement with Laos and the Russian oil companies Gazprom, and the state-owned China National Petroleum Corporation also signed another one to pay with yuan and rubles for Russian gas shipments here.

An official statement then specified that the payment mechanism is ‘mutually beneficial, timely, reliable and practical’, as it will facilitate operations and encourage more companies to take a similar step.

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