Vietnam, Russia banks in currency deal

Source: Pano feed

Tran Thu

Representatives of BIDV and VTB exchange the MoU in HCMC on April 7 - PHOTO: MINH KHUE

Representatives of BIDV and VTB exchange the MoU in HCMC on April 7 - PHOTO: MINH KHUE

Both sides also agreed to raise the potential role of Vietnam-Russia Joint Venture Bank (VRB) and enhance trade and economic cooperation between the two nations.

As part of the deal, BIDV and VTB will set up a private payment channel to support export-import payments for enterprises, with VRB chosen as the intermediary for implementation.

A joint working group will be established and both sides will discuss a specific implementation roadmap in April to work towards using domestic currencies for payment.

Speaking at the signing ceremony in HCMC on April 7, BIDV chairman Tran Bac Ha said that 97% of the payments for Vietnamese-Russian transactions are in U.S. dollar and only 1.7% in domestic currencies. Therefore, the cooperation will help enterprises from both sides cut payment expenses and step up trade exchanges.

Asked when domestic currencies were used for payment, Ha told the media that this is a complicated matter due to risks including the depreciation of the Russian rouble against the greenback in recent months. Besides, both Vietnam dong and the rouble are weak currencies and enterprises still prefer cash in payments.

However, both countries are determined to improve domestic currency payments in the coming time.

Russia and China have also agreed on the use of domestic currencies for payment, Ha said.

The rouble has weakened strongly while the greenback has been firmer against other currencies, raising concerns that Vietnamese firms may face risks for their payments in the rouble.

However, Ha said the greenback has appreciated while the rouble has fluctuated. BIDV and VTB will seek approval for related sides and VRB to serve key projects and governmental cooperation programs, covering various sectors such as oil and gas, energy, nuclear power and defense. VRB will provide services such as account, payment, credit, cashier and deposit.

To enhance the role and financial capability of VRB, both sides have plans to raise its chartered capital in the future.

The signing ceremony took place after a meeting between Russian Prime Minister Dmitry Medvedev, Vietnam’s Deputy Prime Minister Hoang Trung Hai, other officials and representatives of leading companies from Russia and Vietnam.

The Russian PM at the meeting called for cooperation in the fields of energy and oil and gas. He also said Vietnam and Russia should take advantage of potential of VRB and seek a new cooperation model for payment in domestic currencies.

Đăng ký: VietNam News