ISLAMABAD: Standard Chartered Bank under Belt and Road Initiative (BRI) of China is all set to provide RMB-based solutions to importers and exporters for maximizing share of trade for Pakistan in $2.5 trillion trade volume available to countries taking advantage from BRI.
Addressing a press conference Wednesday, Chief Executive Officer (CEO) Standard Chartered Pakistan Shazad G Dada along with visiting Jean Lu, Head of Global Banking of Standard Chartered Bank, said, “We will provide RMB-based solutions to promote trade under China-Pakistan Economic Corridor (CPEC).”
To another query, Jean Lu said that RMB is not replacing the US dollar, as Chinese currency is being used as alternate options. Pakistan and China, she said, have done currency swaps and they are seeking offshore and onshore licenses from China in order to promote trade in different currencies.
They said that CPEC provides opportunities to the SCB, which is better placed due to ages old presence in both the countries to provide services Renminbi (RMB) and as a bank SCB does not only provides funding but is more than that as it provides hedging equity level service advocacy to its clients and international expertise how to benefit from the Road and Belt project.
They said that as China-Pakistan Economic Corridor (CPEC) enters the second phase, it provides opportunities to the banks to provide capital requirements to investors. He said that the bank is working on RMB initiative in Pakistan for importers and exporters.
They said that experts from Standard Chartered Bank’s Greater China Region hosted road shows in Sri Lanka, Bangladesh and Pakistan to outline the benefits of and investment opportunities from China’s B&R initiative, together with Renminbi internationalization.
The purpose of these road shows is to enable clients to take advantage of the benefits presented by China-led Belt & Road Initiative (BRI), which is also bringing more cooperation opportunities for Pakistan and China. The BRI, the biggest support to globalization in the world today, is aiming to boost trade and investment growth across Asia, extending to the Middle East, Africa and Europe.
Trade between China and countries along the Belt and Road has been robust. Total trade between China and B&R countries exceeded US $3 trillion between 2014 and 2016, and the momentum has continued in 2017 despite subdued growth in global trade.
The BRI has made significant headway in the past four years and has gained support from more than 100 countries and international organisations, and more than 80 of them have signed cooperation agreements with China.
Shazad Dada, Chief Executive Officer Standard Chartered Pakistan, commented, “The bank has been in Pakistan and China for more than 150 years. Our longstanding and deep-rooted presence in both countries along with 70 percent of footprint overlap with B&R countries equips us with in-depth knowledge of prevailing political, economic and cultural environments making us an indispensable partner in this extraordinary progress. It is, therefore, incumbent upon us to assist our valued clients to capitalize on these enormous trade opportunities created through better connectivity between them and the rest of the world. This road show emphasizes our promise to be ‘here for good’, while demonstrating our capabilities in providing comprehensive set of products, services and solutions to our existing as well as prospective clients who are looking to embark upon their growth journeys along the Silk Road.”
When asked about regulatory regime under Financial Action Task Force (FATF)), the CEO Standard Chartered said Pakistan has undertaken several steps by enacting Anti-Money Laundering (AML) laws, Benami Act and other steps.
Jean Lu commented, “The Belt and Road Initiative will benefit all countries along the routes, contributing to global economic and social development. Many countries, like Pakistan, have robust demand for infrastructure, as they move toward further industrialisation, move up the value chain, as well as absorb fast-growing populations. Improved infrastructure will foster formation of production chains at the regional level based on comparative advantage, hence improving productivity.”