Luxembourg eyes Europe bridge

Luxembourg wants to expand financial collaboration with China as it develops itself as an offshore yuan market and acts as a bridge to Europe, Finance Minister Pierre Gramegna said in Shanghai yesterday.

Gramegna also said Alipay, a major online payment platform in China, would set up its European entity in Luxembourg following other Chinese financial companies.

"This is a strong reflection of Luxembourg's position as a modern financial hub," the finance minister said.

Luxembourg supports the yuan's internationalization and seeks to further develop its role as a financial bridge between China and Europe, said Gramegna, leading a team of 70 financial executives on a visit to China.

Last week, China's central bank signed a memorandum of cooperation with its Luxembourg counterpart on setting up a yuan clearing bank.

By the first quarter of this year, Luxembourg held a 79.4 billion yuan (US$12.8 billion) pool of yuan deposits, up 24 percent from the fourth quarter of last year.

Gramegna said the Agricultural Bank of China will set up its European Union headquarters in Luxembourg. The Bank of China, the Industrial and Commercial Bank of China and China Construction Bank have already set up operations there. He also said China Merchants Bank will open branches in Luxembourg.

Gramegna witnessed the signing of a memorandum of understanding between the Asset Management Association of China and Luxembourg's Investment Fund Association at a ceremony in Beijing.