The Nanning branch of the People's Bank of China (PBC) has planned and implemented five innovative financial pilot projects for companies operating in the China-Malaysia Qinzhou Industrial Park (CMQIP), which were later expanded to other areas and regions.

The Nanning branch of PBC makes financial pilot projects for CMQIP-based companies. [Photo/WeChat account: gh_df8bc987e060]

The five implemented projects at CMQIP include the facilitation of convenient cross-border two-way renminbi (RMB) flow, cross-border RMB interbank financing, RMB loans for overseas projects in the China-Malaysia Qinzhou Industrial Park, and the cross-border transfer of domestic credit assets. All of these have brought convenience to the investment and financing sectors, as well as helped cross-border capital flow.

On Sept 26, 2021, the bank extended its cross-border two-way RMB flow policy to include the Guangxi Pilot Free Trade Zone. On July 1, 2022, the bank expanded its overseas scope regarding the cross-border transfer of RMB credit assets from just Malaysia to 10 other ASEAN countries.

By the end of 2022, a total of 48 branches of 14 banks in Guangxi had registered to become pilot banks that facilitate these new projects, and 121 enterprises had been included on the "white list" and are now able to facilitate cross-border two-way RMB business. All five pilot businesses had been implemented, with a total investment amount of 21.3 billion yuan ($3 billion).

Cross-border RMB interbank financing was the first institutional innovation made by China in this sector. It brought liquidity guarantees to banks in Malaysia when conducting RMB businesses and expanded the channels for Malaysian banks regarding the allocation of RMB funds.

In 2022, the amount of cross-border RMB between Guangxi and Malaysia reached 7.6 billion yuan, an increase of 1.1 times compared with the same period in 2020 before the pilot program. Trade and direct investments also increased by 1.5 times and 11 times respectively due to these projects.