Ip Sio Kai, a member of the Macau Legislative Assembly and president of the Macau Banking Association (MBA), on Tuesday, 21 July, called on local authorities to promote the digital yuan in trade between China and Portuguese-speaking countries, with the aim of strengthening the competitiveness of the financial sector.
“The government and the relevant sector should jointly promote the accession of the central banks of Portuguese-speaking countries to the mBridge system” — the multilateral central bank digital currency (CBDC) mechanism — Ip Sio Kai said in a statement delivered ahead of the formal agenda of a session of the parliament of the Macau Special Administrative Region.
In June, the Monetary Authority of Macau attained full member status in the mBridge project and completed the integration of its systems. In an initial phase, 11 local banks were authorised to become participating institutions, and the first transactions through the platform were officially launched.
The lawmaker added that authorities should explore broader use of the digital yuan (e-CNY) and the digital pataca (e-MOP) in Sino-Lusophone markets through the mBridge system, supporting the efficient settlement of yuan-denominated commercial operations and cross-border investment and financing transactions.
According to the MBA president, this drive would reinforce Macau’s central role in Sino-Lusophone financial cooperation, enhancing Macau’s core capacity to provide yuan transaction settlement services to Portuguese-speaking countries.
Ip further argued that the initiative is built on Macau’s unique advantages as a financial services platform between China and the Portuguese-speaking world.
Referring to the mBridge system, Ip described its launch as a milestone marking an important step for Macau in the development of digital currency-based cross-border payment infrastructure.
“This cross-border payment infrastructure, centred on central bank connectivity, effectively resolves the problems of traditional international transfers — which depend on correspondent banking networks, typically take several business days, involve high fees, and offer little transparency regarding the flow of funds,” he argued.
China is the principal international driver of the mBridge project, which has been presented as an alternative to the SWIFT international payments system — the Society for Worldwide Interbank Financial Telecommunication.
Backed by the central banks of China, Hong Kong, Thailand, the United Arab Emirates, and Saudi Arabia, mBridge is led by the Bank for International Settlements (BIS) — frequently described as the central bank of central banks — headquartered in Basel, Switzerland. The platform uses central bank digital currencies to settle transactions within seconds via a custom blockchain known as the mBridge Ledger, reducing dependence on traditional international payment mechanisms and offering an alternative to conventional systems, including SWIFT.
Beijing is actively promoting the use of mBridge to settle contracts for energy, raw materials, and large infrastructure projects with strategic partners in the Middle East and Asia through the cross-border payment platform.
mBridge is also viewed by some analysts as a strategy designed to reduce participating countries’ dependence on the US dollar and dollar-denominated assets, by facilitating international trade without the need to use the American currency as the settlement instrument in every transaction.
Source: Diário Económico
