China, Laos expected to further cooperate in finance

The 2017 Boao Forum for Entrepreneurs was held December 12 in Boao, south China's Hainan Province. Yao Bin, chairman of the Chinese Chamber of Commerce in Laos and chairman of the Lao Kritaphong Group, said at the forum that the Belt and Road Initiative favours win-win cooperation and is popular among Lao companies. Yao also suggested that the two countries should follow up and accelerate their shared strategic cooperation in their financial sector in the context of the Belt and Road Initiative.

Yao Bin explained that Lao enterprises have an urgent demand for financial services. Taking his company as an example, the leverage rate is very low, at only around five percent.

“The financial industry is underdeveloped in Laos, with inadequate strength and few products. It is mainly restricted to loans. The financial services currently available cannot meet the financing needs of Lao enterprises,” Yao Bin explained.

In 2016, Yao’s company obtained support from Chinese banks. Its diplomatic compound project got the first ever non-financially guaranteed loan from the ICBC branch in Vientiane. Meanwhile, the Yunnan branch of China Credit Insurance provided a loan guarantee. Collectively, these loans totaled 50 million US dollars, a case showing how Lao businesses can obtain Chinese financial support.

“The best part of the Belt and Road Initiative is that it is win-win in nature. It is not only for China’s interests, but for all the countries involved. It is a partnership by and for everyone.”

Yao Bin believes that after the two countries signed bilateral agreements, and as the China-Laos Economic Corridor and China-Laos Railway project accelerate, the level of economic and trade ties will be consolidated. Laos will take new steps in terms of agriculture, industry, science, technology, urban infrastructure, trade, tourism, logistics and more.

“The golden period for the rapid development of the Lao economy has come. Strategic cooperation between Laos and China in the financial field should also be ready to help the country seize new opportunities,” he said.

In order to speed up bilateral financial endeavors, Yao Bin put forward some specific proposals. First, he said a unified liquidation and settlement system between commercial banks in Laos should be established. Second, he argued, standards and institutional mechanisms for Belt and Road credit ratings should be set forth. His final idea was to build a market system for international bonds along the Belt and Road.

Chinese source: Xinhua