The US Net International Investment Position (NIIP) has posted a deteriorating trend for over a decade now, raising concerns of the financial condition and creditworthiness of the US as a habitual debtor nation

New digital financial infrastructure, new regional free trade agreements, and decisive leadership in the emerging sustainability and green agenda bode well for international RMB adoption.

As the trade finance industry collectively progresses to address challenges around digital fragmentation and isolation, adoption of standard solutions and well-established legal frameworks along with technology as an enabler will play critical roles in truly digitalising trade.

The use of RMB in international transactions will increase despite US-China trade frictions and on-going COVID-19 pandemic according to the latest annual survey on RMB internationalisation conducted jointly by China Construction Bank and Asian Banker Research.

Pressure on margins from increased competition and compliance requirements is forcing the industry to recalibrate its trade finance offerings. While institutions know that trade digitalisation is important for the future of the business, success relies heavily on deeper coordination and collaboration between the myriad participants in the trade finance ecosystem and technology enablers

Electronic channels and bank agnostic platforms are transforming traditional trade finance functions across Asia Pacific

The shift in global supply chains is accelerating demand for new financing programmes and solutions that aim to accelerate and improve trade digitalisation processes

Trade finance is gradually digitalising amid evolving e-commerce models, driven by technology and sustainability; the $2.5 trillion global trade finance gap affecting SMEs prompts innovation in blockchain, tokenisation, and sustainability, despite geopolitical complexities

Transaction banks in the Middle East are expanding services in non-oil businesses with high growth potential, in line with economic diversification, and to mitigate geopolitical instability in countries in the Gulf Cooperation Council

The majority of institutions surveyed attribute their increased Renminbi usage to China’s investments and partnerships facilitated by the Belt and Road Initiative

The global use of Renminbi is influenced by geopolitics, macroeconomic conditions, infrastructure, and technology

Surveyed institutions continue to adopt RMB in cross-border trade, driven by cost benefits and foreign exchange risk management