Innovative technology connects China and ASEAN, with the RMB becoming a key choice for regional trade and investment

Why is Renminbi settlement rapidly spreading in ASEAN trade?

In the current period of deep adjustment in the global economic landscape, the escalating U.S. tariffs and technology controls present new challenges to the ASEAN regional supply chain, while also making ASEAN, with its geographical location, population, and resource dividends, one of the most promising core markets for Chinese enterprises going abroad.

Recently, at the ASEAN Innovation Cooperation Development Forum during the 2026 Zhongguancun Forum Annual Meeting, various parties, both domestic and foreign, engaged in in-depth discussions on how artificial intelligence empowers Chinese companies going abroad, with all parties agreeing that AI is reshaping the global industrial landscape at an unprecedented speed.

Attendees noted that 2026 marks the fifth anniversary of the establishment of a comprehensive strategic partnership between China and ASEAN. The core of Chinese enterprises going abroad has shifted from “going out” to “integrating in,” evolving from initial product exports to full industrial chain layouts, with AI, digital economy, new energy vehicles, and intelligent manufacturing becoming new avenues.

The internationalization of the Renminbi has also achieved leapfrog development in this process. Xin Tao, head of the China Wholesale Banking Department and Corporate Banking Department at UOB, and president of the Beijing branch, shared new changes she has observed in an interview with Yicai: previously, only about 10% of clients were willing to settle in Renminbi; now this proportion has changed to around 30%, with another approximately 30% of clients willing to explore Renminbi settlement.

From Product Exports to Full Industrial Chain Layouts

From initially testing the waters with product exports to now establishing full industrial chain layouts, Chinese enterprises are increasingly determined in their steps to enter ASEAN.

“The speed of industrial chain upgrades is much faster than we imagined,” Xin Tao stated. Nowadays, enterprises going abroad have upgraded from simple trade and product exports to full industrial chain expansion, no longer acting alone but investing long-term in local markets with funds, further driving the collective development of industry chain partners.

Under the long-term orientation layout, enterprises are placing greater emphasis on sustainable development. “Companies are setting up regional fund centers in ASEAN for efficient fund management, and this has led to a shift in thinking, transforming ASEAN from a trade endpoint into the first stop for overseas layout and a bridgehead for global expansion,” Xin Tao said.

Behind this development trend is the solid economic and trade cooperation foundation between China and ASEAN. Data shows that China has been ASEAN’s largest trading partner for 17 consecutive years, while ASEAN has been China’s largest trading partner for six consecutive years. By 2025, the total bilateral trade value has surpassed 1 trillion yuan, and the deep integration of supply chains has become the core driving force behind the rapid growth of bilateral trade.

At the same time, the vibrant vitality of the ASEAN economy provides fertile ground for Chinese enterprises going abroad. The economic growth forecast for ASEAN in 2026 is expected to exceed the global average growth rate. According to the latest forecast from the ASEAN+3 Macroeconomic Research Office (AMRO), the economic growth in Southeast Asia will show differentiated development this year, with Vietnam’s GDP expected to grow by 7.6%, the Philippines by 5.3%, followed by Cambodia at 5.1%, Indonesia at 5%, Laos at 4.6%, Malaysia at 4.4%, Singapore at 3%, Myanmar at 2.5%, Thailand at 1.7%, and Brunei at 1.6%, continuously releasing regional development potential.

Wang Sheng, chairman of China Galaxy Securities Co., Ltd. (referred to as “China Galaxy”), stated that the current innovative cooperation between China and ASEAN presents three distinct characteristics: the form of cooperation has shifted from single product or business exports to deep layouts of the entire industrial chain; the fields of cooperation have expanded from traditional manufacturing to emerging tracks such as artificial intelligence and green technology; and the cooperation model has evolved from enterprises acting alone to multi-party collaborative ecosystem development.

Renminbi as a Trade and Investment Choice in the Region

The model upgrade of Chinese enterprises going to ASEAN has also raised higher demands for financial services. Traditional point-based financial services can no longer meet the needs of enterprises for full industrial chain layouts and long-term development, and a complete “overseas support ecosystem” has become the core demand for enterprises.

“Today, what enterprises need is not just point-based financial services,” said Zheng Jun, CEO of UOB Hong Kong Branch. Currently, when Chinese technology companies are establishing themselves in ASEAN, their main concerns are: whether they can efficiently allocate cross-border funds, adapt to compliance requirements in different markets, promote supply chain localization, and establish a sustainable and replicable development system.

In response to this demand, financial institutions are ramping up efforts, customizing a package of financial solutions for clients to address risks related to markets, exchange rates, interest rates, and compliance risks caused by market uncertainties, thereby reducing the “information gap” and “onboarding friction” for enterprises.

Xin Tao stated that the service dimensions of financial institutions are continuously deepening and upgrading, from initially helping clients expand markets and sell products, to assisting clients in establishing roots in local ASEAN markets, and further leveraging the ASEAN market to help clients expand overseas, achieving mutual growth in partnership with clients.

China Galaxy is leveraging its advantages of domestic and overseas coordination to provide comprehensive cross-border financial services throughout the entire cycle. Since 2025, it has completed 71 investment banking projects in Southeast Asia, with a transaction scale of about 4.7 billion Singapore dollars. The company’s international business platform based in ASEAN—Galaxy Overseas—has become one of the most influential Chinese financial institutions in the ASEAN region.

The innovation in financial services has continuously enriched the scenarios for Renminbi use in ASEAN, fundamentally changing the previous reliance on U.S. dollars for trade. The Renminbi has gradually become an important currency choice for regional trade and investment.

The People’s Bank of China’s “2025 Renminbi Internationalization Report” shows that the acceptance of the Renminbi in the ASEAN region has significantly increased. In 2024, the amount of Renminbi payments in ASEAN grew by 30% year on year, particularly with foreign exchange trading being quite active, increasing by 80%, marking the largest growth in nearly a decade. Nearly 80% of surveyed institutions indicated that they are currently using Renminbi for business settlements. Moreover, the advantages of the Renminbi, such as its stable value and convenient payments, are becoming increasingly prominent. The scenarios for Renminbi payments, settlements, exchanges, investments, and financing in the ASEAN region are becoming increasingly diversified, with a noticeable increase in Renminbi financial products and services.

The popularization of Renminbi settlement has further boosted bilateral trade development, helping enterprises avoid exchange rate risks.

For instance, in the case of Malaysian durian imports, “In recent years, we have serviced many fruit importers. China is now the largest importer of Malaysian durians. Previously, many large importers could only settle in U.S. dollars with local farmers, and initially, local farmers were very resistant to accepting Renminbi. Through the direct connection system between Renminbi and the local ringgit, we have enabled domestic importers to pay in Renminbi, with Malaysian farmers directly receiving the local ringgit, allowing both parties to completely escape the risks of U.S. dollar fluctuations, while also eliminating double foreign exchange conversion steps and costs, stabilizing enterprise profits and encouraging more ASEAN merchants to accept Renminbi settlements,” Xin Tao said.

Focusing on the New Track of Scientific and Technological Innovation

Standing at a new starting point with the fifth anniversary of the establishment of a comprehensive strategic partnership, how can we further explore cooperation potential, especially achieving higher levels of mutually beneficial cooperation in the field of technological innovation?

Xin Tao stated that at this stage, Chinese enterprises going to ASEAN are facing two core pain points: first, externally, there are potential market risks influenced by the increasing uncertainty of U.S. tariffs and related policies, which may affect the economic development trajectory of China and ASEAN; second, there are risks related to enterprises’ own localization integration. Nowadays, the core challenge has shifted from merely “going out” to how to “integrate in.”

ASEAN is both a safe haven and a new track. Poshanlang, president of the ASEAN Economic and Trade Promotion Association, stated that ASEAN countries have a strong demand for digital transformation, while China has rich experience in fields such as artificial intelligence, big data, and cloud computing. It is essential to encourage the research institutions, universities, and enterprises of both sides to establish closer cooperative relationships, jointly build laboratories, technology management centers, and innovation incubators, and explore the establishment of policy coordination mechanisms conducive to the cross-border flow of innovative factors, allowing talent, technology, capital, and data to flow more smoothly.

Small and medium-sized enterprises are the backbone of economic development for both sides and are also important vehicles for cooperation. Poshanlang suggested making good use of various cooperative platforms to provide small and medium-sized enterprises with technical training, financing support, and market connection services. Financial institutions and technology companies should also develop innovative products suitable for small and medium-sized enterprises to help them integrate into the regional industrial chain and enable the benefits of cooperation to reach more market entities.

In the face of a complex and ever-changing international situation, open cooperation has become a common choice for China and ASEAN. Wang Sheng stated that the more difficulties there are, the more precious open cooperation becomes. In the future, we will continue to leverage cross-border financial advantages to assist Chinese enterprises in their global layout.

(This article is from Yicai)