KUALA LUMPUR (June 20): The Export-Import Bank of Malaysia Bhd (Exim Bank Malaysia) and the Industrial and Commercial Bank of China (Malaysia) Bhd (ICBC Malaysia) have inked a memorandum of understanding (MOU) to jointly promote the use of the Chinese yuan as a trade and investment settlement currency between Malaysia and China.

Exim Bank Malaysia acting president and chief executive officer (CEO) Nurbayu Kasim Chang said the move will promote transactions and foster financial integration between the two nations.

"This MOU is a testament to Malaysia and China's strong and sustaining relationship. 

"As we celebrate 50 years of diplomatic ties, the MOU aims to enhance cooperation between the ICBC Group entities globally and Exim Bank Malaysia to foster bilateral trade and investments, including the ICBC Business Matchmaker (BMM) platform," she said at the MOU exchange ceremony on Thursday.

The MOU also outlines a framework for strategic collaboration to promote mutual benefits and deepen financial ties between the two institutions.

Nurbayu said Exim Bank Malaysia is looking forward to collaborating with Exim China, which will be offering renminbi (yuan) financing around the end of this year. "This will be announced soon and that will be one of the key initiatives we are undertaking," she said.

On the Incentive Scheme for Exporter's Sustainability (SIP2), Nurbayu said Exim Bank Malaysia has approved over RM150 million in financing to 20 micro, small and medium enterprises (MSMEs) and corporate exporters to date. She said the target is to achieve RM1 billion under the SIP2 programme by the end of 2025 or 2026.

According to Nurbayu, SIP2 is an incentive programme announced in Budget 2023 which comes with a profit subsidy which will empower Malaysian businesses particularly those expanding overseas.

ICBC Malaysia managing director and CEO Xie Shaoxiong said the MOU reflects the bank's commitment to fostering economic growth and strengthening its bilateral financial ties. "We look forward to a prosperous partnership that will contribute to the development of both countries," he said.

The ceremony was witnessed by Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz, Exim Bank chairman Datuk Charon Wardini Mokhzani, senior representatives from both banks, key governmental figures and business leaders from both countries. 

Tengku Zafrul said the MOU represented a significant step in enhancing the financial cooperation between Malaysia and China. 

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