China puts yuan within easier reach of Africa, but adoption faces major hurdles: report
China is making it easier for African countries to pay for Chinese-led infrastructure projects in yuan, but weak banking rules, high debt levels and historical dependence on the US dollar and euro continue to limit broader adoption of the currency, an Egypt-based political scientist said in an analysis released on Monday.
Beijing had been expanding its financial influence across Africa by integrating Standard Bank, the continent’s largest lender by assets, into China’s Cross-Border Interbank Payment System (CIPS), wrote Nadia Helmy, an associate political science professor at Beni Suef University in Egypt, on the digital media platform Modern Diplomacy.
CIPS, which Beijing promotes as an alternative to the Society for Worldwide Interbank Financial Telecommunication, commonly referred to as Swift, forms part of China’s broader effort to internationalise the yuan.
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