UOB China CEO Peter Foo on ASEAN connectivity and RMB internationalization

by He Liuying

As China deepens financial openness and strengthens ties with ASEAN, the internationalization of the RMB takes center stage. Peter Foo Moo Tan, President and CEO of UOB China, outlines the bank’s strategic role in fostering cross-border trade, supporting sustainable growth, and bridging global markets with innovative financial solutions.

Jiemian News:Could you share UOB’s business development and adjustments in China over the years?

Foo:UOB has a long-standing presence in ASEAN, operating over 400 branches across major economies such as Singapore, Indonesia, and Thailand. We will mark our 90th anniversary next year. In China, we have been active for 40 years, covering five major economic zones. Since our local incorporation in 2008, our revenue and assets have grown nearly fivefold.

We lead foreign banks in Southeast Asian currency services, precious metals, and cross-border RMB trade financing. With initiatives like the Belt and Road and the deepening China-ASEAN ties, we have adopted a dual focus: strengthening China-ASEAN connectivity and collaborating with local institutions, such as Hengfeng Bank, to develop innovative cross-border business solutions. These efforts have driven steady growth across our operations.

Jiemian News:How has the deepening China-ASEAN relationship brought opportunities for UOB?

Foo:Strengthening China-ASEAN trade ties presents enormous opportunities. China and ASEAN have been each other’s top trading partners for four consecutive years. From January to October this year, total trade between China and ASEAN reached 5.67 trillion yuan (US$780 billion), up 8.8 percent year-on-year.

To capitalize on these opportunities, UOB has positioned itself as a “Top Cross-Border Trade Bank,” aiming to expand our ASEAN trade assets from 1 percent in 2023 to 5 percent by 2026. ASEAN-China trade flows have grown by over 34 percent between 2020 and 2023, becoming a major driver of Asia’s economic dynamism.

Our extensive network allows us to support businesses throughout the supply chain, from suppliers to manufacturers and consumers. By integrating sustainability into these solutions, we align with evolving industry needs and contribute to sustainable growth.

Jiemian News:Recent policies have boosted market confidence. What are UOB's views on foreign institutions’ prospects in China?

Foo:China’s policy measures since September have significantly bolstered market confidence, particularly in consumer-related sectors. In the long term, China’s focus on high-quality production capacity and industrial upgrades creates fertile ground for foreign institutions.

High-tech manufacturing, for instance, has seen robust growth, reflecting the country’s structural shift toward innovation and sustainability. At UOB, we are building specialized teams in key industries such as healthcare, technology, and manufacturing to meet the growing demand for tailored financial solutions.

Jiemian News:UOB recently issued a 50-billion-yuan Panda Bond. What is the significance of this issuance?

Foo:This was our second Panda Bond issuance since 2019 and a major milestone. It underscores UOB’s commitment to supporting RMB internationalization and actively participating in China’s capital markets.

The bond was oversubscribed by 1.73 times, with over 20 percent of investors being first-time participants. This highlights the strong appeal of RMB assets globally, given the currency’s stability and competitive financing costs.

Jiemian News:What trends are you observing in the demand for RMB usage, particularly with the growing China-ASEAN trade?

Foo:Cross-border RMB settlements reflect the currency’s growing role in international trade. In 2023, China-ASEAN RMB settlements totaled 5.9 trillion yuan, a 20.2 percent year-on-year increase.

The RMB’s stability and lower financing costs make it increasingly attractive for ASEAN businesses. Chinese companies are also shifting cross-border trade contracts from USD to RMB to mitigate currency risks, a trend we expect to accelerate in the coming years.

Jiemian News:What role do foreign banks play in advancing RMB internationalization?

Foo:Foreign banks are uniquely positioned to leverage their global networks to drive RMB adoption. For instance, UOB has proposed cross-border RMB refinancing tools to stabilize trade financing rates and reduce costs for businesses.

We also offer tailored solutions like direct currency exchange between RMB and Southeast Asian currencies. This eliminates costly intermediate conversions and boosts efficiency for regional trade participants.

Jiemian News:UOB recently signed a memorandum with the Shanghai Gold Exchange. What does this collaboration entail?

Foo:This partnership, part of the 20th China-Singapore Bilateral Cooperation Meeting framework, focuses on strengthening international trading and delivery services in the gold market.

As a leading foreign bank in precious metals, UOB actively supports initiatives like RMB-settled gold imports and supply chain financing. By bridging the gold industry value chain between China and ASEAN, we aim to enhance regional connectivity and promote sustainable growth.