In a recent news story broadcast over the Malaysian National News Agency Bernama, it is said that China's long standing trade relationship with Malaysia may very well signify that business transactions and other trade may be accomplished with Chinese Yuan as well as in the country's local currency by 2015.
In a recent news story broadcast over the Malaysian National News Agency Bernama, it is said that China's long standing trade relationship with Malaysia may very well signify that business transactions and other trade may be accomplished with Chinese Yuan as well as in the country's local currency by 2015.
Candy Ho, the HSBC Head of Asia-Pacific RMB Business Development said, “Chinese traders could be prepared to share with their foreign counter parties the benefit gained from removing the currency risk in transactions.” Ho added that businesses in Malaysia that will be trading with the renminbi may be taking a step towards winning market share since trading with Chinese Yuan would give them a competitive edge.
More from the said news broadcast, it mentioned that the biggest trading partner of Malaysia is China. As of May 2013, trade activities with China account for 14.3% of Malaysia's total trade. Likewise, it was also mentioned that Malaysia is the most important trading partner of China in the Southeast Asian region. As a matter of fact, China recently increased the investment quota of Malaysia's central bank, increasing the bank's quota by more than 50%.
In another interview, Ho told the media, "Chinese people are more willing to do business with you when you're using RMB. Malaysian importers can also gain exposure to bigger group of suppliers in China, while exporters can expand their importer base there."
HSBC recently conducted a survey with their international clients, and it showed that 56% of the survey participants would be glad to trade using Chinese Yuan and are even willing to offer discounts to those who will, while 73% also believe that the Yuan will increase in value in the next half decade.
In addition to that, HSBC believes that by 2015, 30% of trade with China (which could amount to USD2 trillion) may be done in renminbi. As a result, the Yuan may very well become the third most important currency, right next to the American dollar and Euro, on the global market.
One of the most significant advocates of the Yuan in the international market has been HSBC. In fact, it was one of the first banks to directly trade Yuan with other currencies, namely the local ring git, the Japanese yen, and the Australian dollar in the foreign exchange market. Moreover, HSBC wants to help local investors and business people in Malaysia, take advantage of the renminbi's growing popularity, and hope to do so with its expertise, insight and global network.
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