China’s e-yuan trade push in Guangxi brings digital currency closer to Asean settlements as pilot programmes widen

A southern Chinese region has pledged to become a pioneering zone for using the e-yuan in trade with Southeast Asian countries – the latest sign of Beijing’s ambitions to internationalise its central bank digital currency.

The Guangxi Zhuang autonomous region, which borders Vietnam, will implement nine nationwide functions for the use of China’s digital currency, also known as the e-CNY, and will pilot eight locally unique scenarios. These include using the e-yuan at the annual China-Asean Expo in September, and in business dealings within the region’s free-trade zones and in border trade, according to the Nanning branch of the People’s Bank of China.

While China has yet to announce a timetable for the official and widespread launch of its digital yuan, trials involving the sovereign digital currency have been carried out in 26 cities nationwide cities, including Beijing, Shenzhen and Chengdu, as well as two Guangxi cities – its capital Nanning and the port city of Fangchenggang.

The central bank branch has already started conducting joint research with local authorities to roll out the implementation quickly, state media China News Service reported, without revealing a timetable.

Nanning alone has seen the opening of 430,000 e-yuan wallets, and the joining of 173,100 local merchants, since its inclusion in a pilot scheme in December, local data showed. And the accumulated value of its transactions had reached 402 million yuan (US$57.7 million) by the end of April.

Advancing the e-yuan’s use at home and abroad, such as by facilitating yuan-denominated bilateral trade and investment, plays into central authorities’ goals of bypassing potential Western sanctions like those imposed on Russia, while gradually cutting into the US dollar’s global dominance in trade settlements.