China to work with Asian neighbours to grow use of local currencies over US dollar in trade, investment
- Central bank governor Yi Gang said China will work with Asian countries to strengthen the use of local currencies in trade and investment
- Bilateral currency swaps among the Association of Southeast Asian Nations (Asean) regional grouping, China, Japan and South Korea have reached US$380 billion
China will work with Asian countries to strengthen the use of local currencies in trade and investment, Yi Gang, the governor of the central bank, said on Wednesday, as part of plans to strengthen regional economic resilience.
Recent years’ progress by emerging Asian nations in using local currencies in trade and investment has strengthened the region’s financial safety net against external shocks, Yi told an event of the Group of 20 (G20) grouping.
“Emerging markets should improve their resilience,” Yi said by video at the event hosted by Indonesia. “This is where regional cooperation has a key role to play.”
Bilateral currency swaps among the Association of Southeast Asian Nations (Asean) regional grouping, China, Japan and South Korea have reached US$380 billion, he said.
Central banks from advanced economies should continue to enhance market communications
Last month, the People’s Bank of China extended a bilateral currency swap pact with Bank Indonesia for three years to deepen financial cooperation and promote investment.
“Central banks from advanced economies should continue to enhance market communications,” Yi added, as this would help mitigate the spillover effect at a time of greater risks to emerging economies from the coronavirus pandemic.