The agreement was signed in Beijing at a ceremony overseen by German Chancellor Angela Merkel and China’s Premier Li Keqiang.
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Shanghai Stock Exchange, Deutsche Börse Group and China Financial Futures Exchange Thursday announced the establishment of a joint venture “China Europe global Exchange”.
Frankfurt has taken the upper hand in its battle with London to connect to China’s capital markets following the announcement of two joint ventures that will link the respective exchanges of Germany and China.
The Frankfurt-based exchange will start trading on November 18.
The new project, the China Europe worldwide Exchange (CEINEX), will be a new marketplace for interbank products, renminbi-denominated currency and interest-rate trading.
“CEINEX is a milestone in the strategic cooperation amongst our three exchanges. Its value proposition to “trade China in worldwide markets” is a major step forward in the internationalisation of the RMB”, said Deutsche Bourse chief executive officer Carsten Kengeter. It will also offer yuan-denominated interest rate and exchange rate products outside China’s mainland, the statement said.
Other exchanges also have renminbi-based products. The CSI300 contract has been one of the most widely traded contracts globally since its launch in 2010.
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A similar link-up between the Shanghai and London stock exchanges has been explored but with no formal agreement as yet. The venture will give participants in China’s interbank market the chance to trade Deutsche Boerse’s derivatives and cash products, and likewise will allow the German exchange’s customers to trade Chinese interbank assets.
