The rising yuan, which hit its highest last week since China’s FX market was set up in 1994,  should boost demand for China’s offshore “dim sum” bond market, and Africa may join in the action.

Trade between China and Africa totaled $200 billion last year, and Standard Chartered expects that to hit $325 billion by 2015, so it makes sense for African governments and companies to hold assets denominated in the renminbi, or yuan as the currency is also known.

Nigeria for instance said in 2011 it would start to hold yuan in its central bank reserves, and Standard Chartered analysts said in a note that Nigeria and Tanzania’s central banks each bought 500 million yuan of a 3.5 billion yuan dim sum bond launched by China Development Bank last July. Standard Chartered says:

As the use of the CNY (yuan) as a trade-settlement currency becomes more widespread, more African central banks are likely to look to diversify their foreign exchange reserves to include the CNY.

 For now, dim sum bond issuance by African governments or corporates outside of South Africa or Nigeria is not likely until the market has deepened and broadened enough to foster significant appetite for African debt denominated in the CNY from Singaporean and Hong Kong investors, who account for around 80 percent of demand in the dim sum market.