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Global Treasury intelligence
Notes on china
Notes on China
Call date: 22nd Nov 2018
This report comprises Damian Glendinning’s commentary on some of the issues raised in our Treasury peer Call on Repatriating Cash from China which took place on 22nd Nov 2018.
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Topics covered in this report
- Flexibility is Key
- Internal pooling arrangements
- Banker’s acceptance drafts
- Structure
- Banking system
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repatriating cash from china
Repatriating cash from China
Call date: 22nd Nov 2018
In this call, members discussed cash repatriation from China, including: Dividends, Cross-border pooling, Entrustment loans and Euro invoicing.
The call was expert chaired by Simon Jones, whose conclusion appears below.
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Chair’s conclusion
Cash can be liberated from China. Dividends are the most robust route to doing this, but cross border sweeping is back in action and working for some corporates. Getting the right local concentration structure is important to leveraging a cross border liberation of cash offshore and can be done in a tax effective way. Invoicing cross border is an equally important topic and as businesses grow tends to become more in local currency via local entities and therefore means more potential cash in China to repatriate in the future
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Treasury & FX in Turkey
Treasury & FX in Turkey
Call date: 12th Dec 2018
In this call, members shared their approaches to Treasury & FX in Turkey, including:
- Currency issues
- Financing
- Hedging
- Credit insurance
The call was chaired by Arnaud Francq whose key takeaways are listed below.
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Key Takeaways
- A number of participants have local distribution but import products from outside Turkey, this creates a mismatch between sourcing in EUR/USD and sale in TRY causing currency exposure.
- Local financing is becoming very expensive, some companies are focusing on reducing local borrowing/debt as a matter of priority.
- Hedging is becoming very expensive, in some cases, it might be easier to limit the currency exposure of the local entity and centralize hedging at HQ level.
- Currency volatility is creating increased challenges for reporting (mark to market) .
- As the economic conditions are becoming more challenging, some participants observed some lengthening of payment terms.
- Increasing limits for local credit insurance is becoming more and more difficult
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