MNI BRIEF: PBOC Further Facilitates Cross-border Yuan Use

The People’s Bank of China will further enhance the convenience of cross-border yuan usage, promote the currency’s adoption in Belt and Road countries, and advance yuan internationalisation amid profound shifts in the external environment, PBOC vice-governor Lu Lei told reporters in a briefing on Wednesday. 

Against a backdrop of weak momentum in global economic growth and rising tariff barriers destabilising global supply chains, Chinese firms are accelerating overseas investments to diversify risks from reliance on single markets and upgrade their industrial capacity, Lu said, pointing to measures to facilitate cross-border investment and financing. (See MNI INTERVIEW: China To Facilitate O/S Investors-PBOC Official)

Recent key initiatives include expanding the functionality of Shanghai’s Free Trade Account (FTA), upgrading the Cross-border Interbank Payment System (CIPS) to enhance its global network coverage, and refining exchange rate hedging services, such as by developing diversified hedging products, to support broader yuan cross-border adoption, Lu said.

These efforts will further solidify Shanghai’s status as a financial hub, he added.