China Will Promote CBDC In Belt And Road Trade
- In cross-border commerce with Belt and Road nations, Xuzhou intends to utilize the mainland’s sovereign digital currency.
- The e-CNY will also be utilized to pay taxes and utility services in Xuzhou, according to the proposal.
- Changshu will pay civil workers and employees of government agencies using digital yuan.
China is broadening the applications of its central bank digital currency (CBDC), known as digital yuan or e-CNY, for its Belt and Road Trade and cross-border commerce, SCMP reported.
As local administrations warm up to the electronic money known as the e-CNY, a city in eastern China’s Jiangsu province aims to utilize the mainland’s sovereign digital currency in cross-border commerce with Belt and Road nations.
Xuzhou, the starting point for many Chinese freight trains destined for Europe, has released a strategy to promote the e-CNY, including its use in cross-border commerce. The city has 18 frequent cross-border train links to 21 European and Asian nations.
One of the first CBDCs to be designed and extensively tested was the digital yuan, often known as digital RMB. Although no formal launch has occurred, the government has widened its testing parameters to cover numerous cities and millions of individuals.
The e-CNY may be used to “better support the Belt and Road Initiative,” according to the Xuzhou local administration, alluding to Beijing’s trade and investment drive. Originally, e-CNY will be used to pay for services and storage fees for products transported by rail. According to the idea, the e-CNY will also be utilized to pay taxes and utility services in Xuzhou in the future.
Jiangsu province, in particular, has taken an aggressive approach to developing digital yuan use cases. Changshu, another city in the province, stated that it would pay civil officials and employees of government agencies using digital yuan.
Trials have already begun. Shenzhen, a nearby city, started giving retail discounts to Hong Kong visitors who pay with e-CNY in February. In December, the Bank of China offered cash rewards to registered clients who utilized digital yuan.
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