Market forces
Natural extension
Products and services
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Opened in 1996, Rabobank Intemational's
(RI's) representative office in Beijing
manages the bank's relationship with the
Chinese government, Chinese financial
institutions and large, semi-governmental
institutions, such as the International
Financial Corporation and the Asian
Development Bank. In 1998, Rl opened a
subsidiary office, called Rabo China Ltd., in
Shanghai, which was initially restricted to a
single lending limit of US$5 million per
cliënt. At the beginning of 2004, however,
the Shanghai office fully converted into an
Rl branch office, with no single lending
limit, and it obtained a Renminbi (RMB),
local currency licence in the third quarter
of 2004. This means that it is able to serve
both foreign companies active in China
and local companies in their own currency.
Chinese banks currently enjoy a 90-95%
market share of local-currency transactions
and the Shanghai branch's RMB licence is
currently restricted to 18 cities in China,
but it is due to be extended nationwide by
the end of 2006. In addition, the branch
obtained a derivative trading licence
during the first quarter of 2005, enabling it
to conduct Global Financial Management
(GFM) business in China.
'People see China as a massive, growing
market, which of course it is,' says Jeroen
Nijsen, RI's General Manager for Greater
China and South Korea. 'In reality, however,
the country's strongest economie growth
is in the manufacturing industry, whereas
the largest proportion of the Chinese
labour force is still employed in the
agricultural sector. Industry provides the
foundation for economie growth, but
everybody needs to eat and drink and,
unless this new-found prosperity spreads
to the agricultural sector, it will be
impossible to sustain current growth levels.'
Orlando Wang, General Manager of the Rl
Shanghai branch, sees the Chinese market
as a natural extension of RI's global
network. 'China has become a very
important market in recent years and the
main reason for our presence here is to
support our existing network clients. Some
of them are investing heavily in China and
we can provide them with local support
as and when they need it.'
The other main reason for RI's presence is
to establish business relationships with
leading Chinese companies and introducé
its business lines within the Chinese
market. 'On the commercial side, we are
focusing on providing corporate banking,
advisory and Mergers Acquisition (M&A)
solutions to companies involved in the
Food Agribusiness (F&A) sector, as well
as selected blue-chip companies in other
industries,' Wang explains. 'In addition to
traditional lending products, such as
short-term and fixed-asset loans, we also
offer GFM products to manage our clients'
interest-rate and currency exposure, as
well as their liquidity positions.
Another important business line we
are pursuing is Structured Trade and
Commodity Finance (STCF). We are in
the process of establishing an STCF
platform in Shanghai, underthe
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