The move by China's central bank to allow direct RMB-US
dollar conversion in three free trade zones (FTZs) is widely
seen as a step forward, but quota limits and unclear rules have
The People’s Bank of China (PBOC) announced
last December that it would allow limited RMB convertibility in
FTZs in Guangdong, Fujian and Tianjin, following the currency's
inclusion in the IMF’s reserve basket.
But local counsel have dismissed the $10 million quota
imposed on multinationals based in these FTZs as too small for
companies to engage in any sizeable transactions.
"The current quota given out to companies operating within
the three zones is limited, especially looking at it from an
investment or project financing point of view," said
Ma Feng, partner at King & Wood Mallesons in
Under the new rules, companies registered in the FTZs