According to a recent survey conducted by the famous HSBC, a lot of business enterprises are using the yuan to carry out business with China, but only a few of them have been capitalizing on the new initiatives laid out by the Chinese government.
The survey reported that in doing this, firms may be missing out on potential business opportunities. Among 1600 senior Chinese executives across 14 countries, 41 percent of the survey respondents in fact were aware of the Chinese trade belt project and how this has erected a mountain of business opportunities for other businesses.
Despite this awareness, only 7 percent of them were actually executing ways on capitalizing this development. The Belt and Road initiative that underpins the larger Chinese infrastructure and policy framework hopes to spur an estimate of $2.5 trillion of global commerce per annum.
The Belt and Road project intends to develop two distinct corridors of trade between China and the rest of the world. Meanwhile, the Belt project refers to the famous Silk Road that connects China to the Middle East and far across Europe; the Road project aims to link the country to Africa, and South-east Asia through the sea.
The HSBC report states that the project has such macroscopic prospects that it will positively impact trade in at least 65 countries, and around two-thirds of the world's population!
Among the firms who are aware of this development, those prevalent in North America and Europe will most probably gain the first mover's advantage. The report says that among the European businesses, around 12 percent are framing business strategies. Meanwhile, the figure has fallen to 9 percent in North America.
As the Chinese development project marches head on, report suggests that it will most likely encourage the international renminbi (yuan) usage. The number of companies using the Chinese currency has risen from 17 percent last year to 24 percent in 2016.
Perhaps a part of the reason is that yuan has become much easier to use. More importantly, the Chinese currency has been added to the IMF's special drawing rights basket. The CNBC reported "We're expecting (that) this internationalization will continue to accelerate."