Before we are starting our well-deserved summer break, let me draw your attention once more to our General Assembly held on June 14 in Zurich followed by our 3rd Renminbi seminar. Swiss newspapers and business journals write regularly about our (incomplete) Swiss Free Trade Agreement with China or the hostile tariff agreements with the United States, but as yet we do not read a lot about the development of a new key currency for global trade. Interestingly, the Renminbi seems to fulfill certain basic requirements: A global key currency needs first and foremost a strong national and globally dominant economy, a fact China has achieved heading these days towards the number 1 trading nation on the globe. But there is a second factor, the so-called political predictability – a topic which seems to lose ground in the homeland of the greenback. Mr. Trump has not only gained the reputation of being unpredictable, he even declares this peculiarity, i.e. his quirk as a part of the new US policy or as a change of government tactics. For the moment, he can afford to gamble since the reference currency for crude oil and gold is still and undoubtedly the dollar. The Euro doesn’t look like a real danger, and the free convertibility of the Renminbi seems to be far from being a real threat. 

It could, however, be that Mr. Trump is underestimating the speed of the Chinese transformation followed by the rapid foreign trade development. Two of the world largest banks, ICBC and CCB have recently opened their branches in Zurich. These banks might still be on a learning path with regards to Western rules and habits, but they did not come to Zurich to finance our local industry but rather to start to play an active role on global transactions – in a dollar and a non-dollar environment. The latter might grow in the coming years.

Quite a number of our SCCC members do not only export their products to China, but have started to jointly develop solutions with their Chinese counterparts – I am convinced they are on the right track.

Let me wish you a nice summer break!



Best regards,

Thomas Christ