China and Egypt Deepen Financial Cooperation with New MoU on Local Currency Settlement and Digital Innovation
In a move that signals closer financial alignment between China and Egypt, the two countries signed a memorandum of understanding (MoU) on July 11 aimed at promoting local currency settlement and expanding collaboration in digital finance, including central bank digital currencies (CBDCs) and payment system innovation.
The agreement was signed during Chinese Premier Li Qiang's official visit to Egypt and witnessed by Egyptian Prime Minister Mostafa Madbouly. According to the People's Bank of China (PBoC), the MoU covers bilateral cooperation in monetary policy frameworks, payment systems, and financial market infrastructure.
One of the central objectives is to boost the use of local currencies in trade and investment, reducing reliance on third-party currencies. The two countries also agreed to enhance technical collaboration and information sharing on CBDC development, reflecting mutual interest in digital finance as a strategic growth area.
During his meeting with Central Bank of Egypt Governor Hassan Abdullah, PBoC Governor Pan Gongsheng emphasized the importance of strengthening practical cooperation in local currency swaps, settlement system interoperability, and cross-border investment. He noted that China-Egypt financial and trade ties have shown steady growth despite global uncertainties.
The MoU also lays the groundwork for deeper institutional linkages, including potential mutual establishment of financial institutions and coordinated participation in capital markets.
The agreement comes amid a broader push by China to promote yuan internationalization and expand financial ties with key Belt and Road Initiative (BRI) partner economies.
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