China is now Africa’s largest trade partner and bilateral trade and investment ties are growing rapidly. As many as 10 000 Chinese-owned firms are operating across Africa.
Growing numbers of African businesses, ranging from individual entrepreneurs to corporations, are doing business in China. Chinese trade and investment offers opportunities to grow Africa’s manufacturing sector, increase the scale and sophistication of African exports, and create jobs across the continent. Since 2008, Standard Bank and ICBC have been working in partnership to support businesses operating in the China-Africa corridor. In the 10 years since our partnership was established, our two banks have provided USD8.5 billion in financing support for over 40 projects in Africa involving Chinese companies, leveraging investment of around USD30 billion.
As Chinese companies increase their capital investment and activity across multiple African markets, they require a full range of ongoing banking services.
ICBC and Standard Bank work together to fulfil these needs. At the same time, we provide a broad range of services for African businesses engaging with Chinese markets. Standard Bank increasingly refers our African clients to ICBC for banking services when they enter China, while ICBC refers its clients to Standard Bank when they enter or deal with Africa. We have joint client mandates for many of China’s biggest investors in Africa. We’re extending collaboration to areas such as private banking, wealth management, credit card businesses, bond trading and settlement, IT and e-security collaboration, cross-border remittance, payments and trade finance risk underwriting.
We have entered into agreements with a number of other Chinese companies, to further expand our offering to individuals and businesses on both sides of the Africa-China corridor. For example:
We have Africa-China banking centres in Johannesburg and Lagos. These are one-stop shops for Chinese businesses and individuals seeking to transact in, across and from Africa. Staffed by Mandarin-speaking bankers, the centres provide a virtual finance hub for personal and business banking clients, and for Chinese importers and exporters. Consultation and advisory services are provided via telephone, online or email, and African and Chinese clients are able to link into China’s digital banking and customer knowledge systems. We’re in the process of opening Africa-China banking centres in a number of other African hubs.
Standard Bank has 30 Mandarin-speaking relationship managers across 15 markets, many of whom are African people. We also operate an entirely Mandarin-speaking branch at Crown Mines in Johannesburg. The branch is dedicated to helping Chinese importers and exporters access business opportunities in South Africa, Lesotho, eSwatini, Namibia, Botswana, Zimbabwe and Mozambique.
At the BRICS Summit, Standard Bank and the China Development Bank signed a USD500 million loan facility, designed to support the growth of Standard Bank’s African SME clients, many of whom are looking to export to China, over the next seven years.
In 2018, Standard Bank took 61 clients from nine African countries to the inaugural China International Import Expo (CIIE), to assist them to secure export contracts with Chinese companies.
Shyft, Standard Bank’s global digital wallet for Android and iOS, allows foreign currency purchasing and trade, all from a mobile phone. Clients and customers throughout Africa and in China can use Shyft to send, spend, store or exchange funds in USD, EUR, GBP and AUD.
We’ve partnered with UnionPay International (UPI), a subsidiary of China UnionPay, the largest card payment organisation in the world. Standard Bank will accept UPI cards in 10 African countries, and we’re licensed to issue UnionPay cards in South Africa – providing a cost-effective and secure mechanism for cross-border payment. This allows UnionPay customers to use their cards on Standard Bank issued point of sale terminals and access the Standard Bank ATM network. South African business travellers to China can use their UnionPay cards issued in South Africa by Standard Bank at merchants and ATMs across China. Standard Bank‘s UnionPay capability also allows Africa-based business people and tourists with Standard Bank accounts, cards or online payment products access to the full range of payment apps currently used to transact in China.
As Africa’s relationship with China matures and deepens, the wider use of China’s currency, the renminbi, across Africa offers opportunities to increase efficiency and reduce the risk and cost of intra-Africa and Africa-China trade.
Standard Bank and ICBC are working together to create multi-currency financing products that make full use of our combined advantages in both local currency and offshore renminbi financing.
We offer a Chinese yuan renminbi (CNY) capacity in all our subsidiaries in African countries. We also offer a 24-hour regulatory-compliant and risk-managed foreign exchange service which includes the renminbi. This is supported by our Mandarin-speaking banking teams, together with our agreement with UnionPay International to host and support their electronic payments portal in Africa, and between Africa and China. Many African countries that experience regular dollar constraints have arranged renminbi swap links, allowing them to use renminbi to pay for imports from China. Renminbi swap links allow the Central Bank of Nigeria to pay for Chinese imports in renminbi whenever needed, effectively removing exchange rate risk for certain key imports.
In 2018, Standard Bank and ICBC celebrated their 10-year partnership. This collaboration included both banks joining the 28 core banks currently developing the UNEP FI Principles for Responsible Banking. Above, Wendy Dobson (Standard Bank) and Jinny Yan (ICBC) are in attendance at the public consultation launch of the Principles for Responsible Banking.