KUALA LUMPUR: (Nov 4): Although many Malaysian firms now use the renminbi to conduct business with China, only a few are taking advantage of Beijing’s “Belt and Road” initiatives, according to a survey by HSBC Commercial Banking.

The initiatives consist of a series of policy developments and infrastructure projects, aimed at developing US$2.5 trillion worth of cross-border commerce annually.

The survey, covering 1,600 decision-makers across 14 countries, showed that the usage of renminbi for business settlement in Malaysia has seen a 6% rise to 20%, compared with 14% in 2015.

However, only 41% of respondents understood the opportunities that the Belt and Road initiatives present. Of that 41%, only 7% are developing a strategy, said HSBC in a statement.

The Belt and Road blueprint, which was first laid down by China’s president Xi Jinping in 2013, aims to develop two corridors that will link China to the rest of the world.

“Belt and Road projects are already presenting huge opportunities for companies that can help develop physical infrastructure such as highways, ports and telecommunications networks,” said HSBC Bank Malaysia’s commercial banking head Andrew Sill.

“But these are only the first steps. By boosting connectivity, Belt and Road will catalyse trade between more than 65 countries that are home to nearly two thirds of the world’s population. For any company seeking growth and new customers, that’s an exciting proposition to explore,” he added.

The ‘Belt’ refers to the historic overland Silk Road trading routes connecting China via central Asia to Europe, and the Middle East, while the ‘Road’ refers to the maritime equivalents to the south, linking China, Southeast Asia, India and Africa.  

HSBC said Chinese enterprises invested US$14.8 billion in 49 countries along the ‘New Silk Road’ in 2016, developing projects such as the Indonesian railway, a Greek logistics hub and Bangladeshi power facilities. The state-run China Development Bank has said it plans to contribute US$895 billion of project funding.

An example of a Belt and Road initiative is China’s investment of US$10 billion (RM43 billion) in the Malacca Gateway Project — a development which will comprise of commercial and residential properties and will be the largest private marina in Southeast Asia, as well as the biggest deep sea port in the region. The project is slated to be completed in 2025.