The Atlanta-based integrator said yesterday it has become the first foreign non-financial company to issue a commercial paper transaction in China’s Renminbi currency as traded out of Hong Kong (CNH).

The commercial paper issued on Friday amounts to CNH 630m, about $99m USD.

UPS said the new financial vehicle was issued against an existing EUR 1bn commercial paper. The company has been raising funds in this way in the US since 1992.

Andy Dolny, the treasurer and chief investor relations officer, said there has been rapid development in the trading of the Chinese currency offshore since China opened it up for use in international transactions in the last few years.

“Companies like UPS can leverage this liquid short-dated CNH money market as an alternative means of funding investments in China,” he explained.

UPS said China was its largest growth market at the moment, and investments in China to date have totaled more than $1bn, including the building of two major air hubs at Shanghai and Shenzhen supporting trade within Asia and to other international destinations.

The shipping company serves more than 330 cities in China.

The new UPS Asia Pacific region president Brendan Canavan said issuing the CNH-denominated commercial paper reflected the company’s support for internationalising China’s currency and its business environment.

He said: “This CNH initiative will give UPS more flexibility in payment, collection and future investments in China, ultimately enabling our clients’ businesses to respond more effectively to expanding trade lanes with international markets.”

Source: Post&Parcel/UPS

Tags: China, investment, UPS