HSBC, Standard Chartered Undeterred By China Trade Tensions

HSBC and Standard Chartered have vowed to continue supporting Chinese companies amid ongoing trade tensions, according to reports Wednesday (October 10).

Global Trade Review said the FIs, which operate as two of the largest trade finance providers in Asia, have emphasized their commitment to the Chinese market and existing government initiatives including Made In China 2025 and the Belt and Road Initiative. Both programs have been criticized by the U.S. Trump Administration.

Yet according to Standard Chartered Head of Transaction Banking for China David Koh, the FI is “definitely going all-in with BRI.”

He spoke in Hong Kong at Coface’s Country Risk Conference, according to the publication. According to Koh, he expects corporates to remain resilient through trade disagreements and is instead more concerned with sanctions.

“What would be a major disruption to supply chains — the biggest potential disruption — would be sanctions, which is a purely political risk, like what the U.S. did with certain Russian companies earlier this year,” he said. “That would be massive because so much of our business is done in U.S. dollars around the region. But aside from that, tariffs are manageable.”

Also Wednesday, Standard Chartered announced a collaboration with Chinese telecommunications giant Huawei to develop a bank financing and payments Internet of Things solution. Huawei is expected to be hit by U.S. sanctions, reports said.

Yet HSBC global head of structured trade solutions Inwha Huh similarly expressed optimism about the Asian market.

“We have a similarly optimistic strategy on BRI,” he said, though acknowledging that HSBC and Standard Chartered may be outliers in their unwavering commitment to China. “The sentiment from the overall bank market may not be as robust as Standard Chartered and HSBC.”

He added that the two banks are “probably more bullish than the foreign bank market.”

Separate reports in the South China Morning Post said China’s Finance Minister Liu Kun is ready to support the nation’s business community through initiatives like export assistance and skills training for those affected by U.S. trade tariffs.