In a move that has been long-awaited by the South Korean government, technology giant Samsung Electronics announced that it was looking into starting won-yuan direct trading.

Staring a won-yuan direct trading will allow Samsung to settle trades and transactions with China directly using the Korean won and the Chinese yuan and not depend too much on the US dollar.

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Samsung did not elaborate its statement about the won-yuan direct trading but analysts said such a move by a giant company will be a big boost for the local market.

The announcement by Samsung also boosted Seoul's ambition to become a global hub for the offshore yuan business.

Samsung's statement also came as the South Korean government announced that it hoped to sign a final free trade agreement with China within the first half of the year, in a further sign of strengthening relations between the countries.

The South Korean government has been encouraging local companies trading with China to settle transactions with the yuan or the won and not depend too much on the US dollar.

Over the long term, the yuan-won rate closely tracks the calculated price from each currency's value against the U.S. dollar, but companies can save costs and reduce the risk from exchange-range volatility in the meantime.

Song In-chang, head of the finance ministry's international finance bureau, expressed hope that Samsung's move will influence other big companies to start won-yuan direct trading.

"This is an encouraging development given that one of the weaknesses on the market was the low demand or supply from the corporate sector," Song told Reuters in an interview.

In November last year, South Korean and Chinese leaders announced that a trade deal could be completed this year, giving Korean firms enhanced access to China's consumers.

China already is Korea's largest trading partner, with two-way trade of US $230 billion in 2013.

TagsOffshore Yuan Trading, South Korea Yuan Trading