China looks to Africa as testing ground for global roll-out of yuan
A growing list of African nations have made deals to explore or implement use of the Chinese currency for trade and financial transactions
During a recent meeting in Cairo, the central banks of China and Egypt signed a series of agreements to promote the use of the yuan in trade and investment. These deals – lauded by People’s Bank of China governor Pan Gongsheng as a key step in advancing economic ties – were signed last week during Chinese Premier Li Qiang’s visit to Egypt.
The deals also cover cooperation on electronic payments, including expanding China’s UnionPay services and facilitating cross-border business in yuan for banks in the China-Egypt TEDA Suez Economic and Trade Cooperation Zone near the city of Suez. That will be done via local currency settlements made through the Cross-border Interbank Payment System, or CIPS – China’s alternative to the SWIFT international payment network.
Egypt joins a growing list of African nations that have yuan-based deals with China, including South Africa, Nigeria and Angola which are all exploring or implementing the use of the Chinese currency for trade and financial transactions.