China plans to expand the international use of its digital yuan and promote a global currency system where multiple currencies coexist.
People’s Bank of China Governor Pan Gongsheng announced the move on Wednesday at the Lujiazui Forum in Shanghai. The country will set up an international operations center for the e-CNY in the city.
Pan said developing a multi-polar international monetary system would help create checks and balances among sovereign currencies and support global financial stability. He said several major currencies could dominate different regions, reducing the world’s reliance on the U.S. dollar.
The comments come as interest in alternatives to the U.S. dollar grows due to recent trade tensions and tariffs. Investors are also exploring other options, including Asian currencies and cryptocurrencies.
Pan said traditional cross-border payment systems are inefficient and vulnerable to geopolitical risks. He warned that they can be politicized and used for unilateral sanctions.
Six foreign banks, including Standard Bank and First Abu Dhabi Bank, have agreed to use China’s Cross-Border Interbank Payment System (CIPS) for future transactions, according to state media. The system is designed to settle international payments in yuan.
China has long aimed to internationalize the yuan, but capital controls have limited progress. Still, use of the yuan has increased in countries such as Russia and with other key trading partners.
Zhu Hexin, head of the State Administration of Foreign Exchange, said China would keep the yuan exchange rate stable and manage external risks. Li Yunze, director of the National Financial Regulatory Administration, told the forum that China will continue to open its financial sector to foreign firms.
Li said foreign institutions play an important role in investment and talent development. He added that China will provide a transparent and stable business environment and consider opening more areas of the financial market to overseas players.
