Yuan: China and South Africa renew swap agreement for five years
Agreement worth the equivalent of 4.5 billion dollars extended. The currency is gaining ground on the continent in tandem with trade
from our correspondent Alberto Magnani
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NAIROBI – The central banks of South Africa and China have renewed a currency swap agreement between the rand and the yuan for a further five years, with a total value of 30 billion yuan or 74 billion in South African currency.
The deal, worth the equivalent of 4.5 billion US dollars, further strengthens the economic, financial and, indeed, currency ties between Pretoria and Beijing, in the wake of the rise in trade and the penetration of the Chinese currency in Africa.
African governments, banks and multilateral institutions have approved or are considering measures to accommodate therenminbi as one of their foreign currencies, alongside the still-dominant US dollar.
The growing ties between South Africa, the continent and China
According to the People’s Bank of China, the central bank in Beijing, the agreement is designed to ‘deepen’ monetary and financial cooperation, ‘facilitate’ trade and investment, and ensure the stability of the financial market at a time of volatility in stock markets and the US dollar. Relations between Pretoria and Beijing have intensified in recent years, beginning with China’s rise to become South Africa’s leading trading partner on a global scale.
The South African Reserve Bank, South Africa’s central bank, recorded in early October that it had overtaken Europe and leapt from sixth place in 2003 to a secure first place from 2026 onwards, with its share of Pretoria’s trade flows rising from 3.1 per cent to 28.6 per cent. Today, the balance of trade favours Chinese exports, with estimates of $23 billion in 2025 compared with around $13 billion in imports from South Africa. The zero tariffs agreement formalised by China in May, which saw the removal of tariffs on 53 African economies, spurred a 24 per cent rise in bilateral trade between May and August alone to US$15 billion, with a 25 per cent surge in South African exports. Total trade flows between Africa and China reached US$348 billion in 2025 and are expected to expand further in the wake of Beijing’s tariff offensive, in parallel with the growing diversification of currencies in favour of the yuan.
