The People's Bank of China and Egypt signed a memorandum of financial cooperation to promote transactions in local currency and develop central bank digital currency.
This memorandum focuses on enhancing cooperation in monetary policy, financial markets, payment systems, and promoting digital innovation and cryptocurrency between the two countries.
MAIN CONTENT
Signing a comprehensive cooperation commitment on finance and payments in local currency.
Strengthening coordination on central bank digital currencies and digital innovation.
Creating a favorable environment to maximize the potential for bilateral cooperation.
What is the agreement signed between the People's Bank of China and Egypt?
The agreement was signed by Pan Gongsheng, Governor of the People's Bank of China, and his Egyptian counterpart Hassan Abdallah, in the presence of leaders from both governments.
On July 10, in the presence of Chinese Premier Li Keqiang and Egyptian Prime Minister Madbouly, both parties signed a memorandum of cooperation to promote financial cooperation and support trade transactions in local currency, as well as developing central bank digital currency (CBDC).
What are the main contents of this agreement?
The memorandum focuses on monetary policy, financial markets, payment systems, and digital innovation related to CBDC.
The contents include: sharing information, exchanging expertise on monetary policy, cooperating to expand local currency payments in financial transactions, bilateral direct investment, as well as coordinating research and testing CBDC and digital technology innovations.
This agreement marks an important step in expanding sustainable financial cooperation between China and Egypt, while promoting the adoption of central bank digital currency (CBDC), contributing to enhancing the effectiveness of cross-border payments.
Pan Gongsheng, Governor of the People's Bank of China, July 2024
What are the practical benefits of the agreement for both countries?
This coordination helps both parties enhance policy coordination capabilities, reduce transaction costs, and strengthen security and efficiency in cross-border payments.
Promoting payments in local currency contributes to reducing dependence on the USD, enhancing the financial sovereignty of both parties. At the same time, cooperation on CBDC helps explore new applications in electronic transactions and payments, increasing transparency and safety.
Financial cooperation with China not only enhances Egypt's reputation in the international financial system but also promotes digital innovation, creating momentum for sustainable and modern economic development.
Hassan Abdallah, Governor of the Central Bank of Egypt, July 2024
What impact does the agreement have on the future of central bank digital currency (CBDC)?
Based on this cooperation, both parties will implement trial projects and share experiences on CBDC, enhancing innovation capacity in the digital finance sector.
This is a step forward to promote the widespread adoption of CBDC, contributing to improving the international payment system to be more convenient and secure, and opening up new models of international cooperation based on Blockchain technology.
What are the next steps for implementing this memorandum?
The parties will conduct regular exchanges, organize technical workshops, and implement bilateral trials on local currency payments and CBDC in 2024-2025.
The next period will also focus on addressing legal issues, standardizing technology processes, and developing infrastructure to support cross-border digital payments between China and Egypt.
Can the financial cooperation features between China and Egypt be compared to those with other countries?
Characteristics China – Egypt China – Other countries Scope of cooperation Monetary policy, local currency payments, CBDC, digital innovation High-level, focused on trade and investment Payment focus Current payments in both local currency and CBDC Commitment level High, with the presence of senior leadership Different, often without formal signing ceremonies
Frequently Asked Questions
Does this agreement promote more effective transactions in local currency?
Yes, to reduce costs and risks of international payments, enhancing the use of local currency in bilateral transactions.
Why is central bank digital currency (CBDC) emphasized in the agreement?
CBDC provides more security, transparency, and efficiency for digital transactions, representing a new trend in the global financial industry.
Does the cooperation help reduce dependence on the USD?
Yes, promoting local currency in transactions will reduce the dominant role of the USD, enhancing national financial sovereignty.
What specific projects will the two central banks implement next?
Local currency payment and CBDC trial projects will be implemented within the next 1-2 years.
Will the agreement have a positive impact on China-Egypt economic relations?
Yes, the agreement creates a solid foundation to promote sustainable and multidimensional economic-financial cooperation.
Source: https://tintucbitcoin.com/trung-quoc-ai-cap-hop-tac-thanh-toan-noi-te/
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