China has decided to expand the use cases for the central bank digital currency- which would be called digital yuan- for the Road and Belt initiative and cross-border trades.
The currency would be one of the first CBDCs to be tested and developed. Although there hasn’t been any official launch yet, the government has expanded the parameter of testing which would include millions of people and quite a few cities.
The plan that promoted the use of digital currency in cross-border trade was initially issued in Xuzhou, which also serves as the point of departure for numerous goods trains from China that were headed for Europe. Currently, there are 18 regular cross-border rail connections from this city to 21 different nations in Europe, and Asia, as reported by the South China Morning Post.
China Has Plans To Introducing CBDC In Selected Regions
For those wondering, Xuzhour is a trade hub that has plans of promoting digital yuan which would be used to pay for the services and the storage charges for goods that were carried along cross-border trains.
This experiment planned on extending the usage of digital yuan to pay for the utilities and taxes in the city in the future. One of the provinces in particular, Jiangsu, has been pretty proactive in the promotion of digital yuan use cases. Another city located in this province, Changshu, also announced that it would be paying the people, as well as the civil servants who work for public institutions using digital yuan.
Apart from the region of China, the Hong Kong Monetary Authority also announced that the Guangdong-Hong Kong-Macao Greater Bay Area would be the testing ground for making cross-border payments through the digital yuan.