The cross-border exchange of regional currencies has become an important way to defend against the global economic downturn and promote trade. To circumvent a shortage of dollars and other currencies, as well as reduce exposure to exchange rate volatility, developing countries in eastern and central Asia as well as South America have implicitly recognized the Chinese yuan as a currency for settlements and, in some cases, reserves.
China is willing and eager to help ease liquidity in the financial system... as long as it gets some justified financial clout out of it.
So far China has established the following currency swaps:
Dec 12 - China and South Korea sign a 180 billion yuan currency swap framework agreement.
Jan 20 - China and Japan sign a 200 billion yuan currency swap between the People's Bank of China -- and the Honk Kong Monetary Authority.
Feb 8 - China signs a currency swap agreements with Malaysia's central bank for 80 billion yuan
March 11 - China signs a 20 billion yuan deal with the National Bank of Belarus
March 24 - China signs a 100 billion yuan swap deal with the Central Bank of Indonesia
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