Hong Kong Greater Bay Area to Trial Digital Yuan
Digital yuan, China’s central bank digital currency, also referred to as digital currency electronic payment (DCEP) venture, will be unveiled for trial at Hong Kong’s Greater Bay Area in the weeks ahead.
The Greater Bay Area (GBA) is a mega city encompassing nine cities including Shenzhen, Guangzhou, along with Hong Kong, and Macau.
A top financial and tech centre in Asia, the GBA has a total population of more than 69 million people and GDP of roughly $1.50 trillion.
He Xiaojun, director of the Local Financial Supervision Administration Bureau of Guangdong Province, highlighted that Guangdong will perform a major role in the trans-border adoption of DCEP. He also pointed out that the province will play a vital role in achieving common platform for virtual banking with Hong Kong. He stated:
“Guangdong will further encourage innovation, deepen business integration with Hong Kong and Macao in virtual banking and other aspects, break through data barriers, and innovate. The use of digital currency scenarios allows modern financial technology to better serve the construction and development of the entire Greater Bay Area.”
As per official GBA website, Hong Kong is the “most open and international city,” in the Greater Bay Area, hosting numerous global trade centres. The website also points out that Hong Kong carries out crucial work in the growth of GBA, while “enjoying the dual advantages” of intergovernmental system referred to as “one country, two systems.”
The report has come days after the PBoC finished last phase of DCEP beta trial in Shenzhen. China is interested in changing the Greater Bay Area into a budding economic centre featuring the digital yuan as the pivot.
China’s intention to unveil central bank digital currency or CBDC in Hong Kong has come against the backdrop of continuing domestic demonstrations over the country’s latest security law. Last month, global banking behemoths such as HSBC, UBS, Credit Suisse and Julius Baer were scrutinizing their customers in Hong Kong for any likely links with the city’s pro-democracy campaign.