As the world’s second-largest economy by nominal GDP, China has actively sought to conduct international trade with its commercial partners using its own currency rather than the United States dollar.
The East Asian nation presented this idea to Egypt, one of its largest trading partners in Africa, after the Chinese president, Xi Jinping, made a historic visit to Cairo.
In a joint statement, the two heads of state advocated for an increase in trade and investment settlements denominated in their respective national currencies, as seen on Xinhuanet.
Additionally, both countries agreed to increase their local currency swap agreement, as reported by DailyNewsEgypt.
As earlier reported, **China's President arrived in Egypt on Tuesday**, his first visit to the Arab world's most populous nation in a decade.
Egyptian President Abdel Fattah al-Sisi welcomed Xi at Cairo International Airport, where they walked a long red carpet flanked by uniformed soldiers, folk dancers, and young Egyptians waving Chinese flags.
During the visit, both presidents discussed cooperation across several sectors including construction, energy, manufacturing, and agriculture.
Both leaders also witnessed the signing of several memorandums of Understanding between business entities from both countries.
The event, which marked the 70th anniversary of diplomatic relations between Egypt and China, also saw them agree to trade in their local currencies.
They released a joint statement disclosing that they had agreed to boost trade in their respective currencies as opposed to the dollar.
The BRICS group of nations, which China is a key member of, has long touted the idea of reducing dependence on the U.S. dollar and promoting a more multipolar global financial system.
Central to this ambition is the discussion of a potential BRICS currency, part of a broader de-dollarization strategy aimed at replacing the dollar as the dominant medium for international trade and financial transactions.
In June, the People’s Bank of China (PBoC) jointly authorised Standard Bank and the Industrial and Commercial Bank of China (ICBC) to operate the Renminbi (RMB) Clearing Bank of Africa, giving businesses and financial institutions across the continent direct access to China’s onshore financial system for the first time.
The move effectively gives African financial institutions their first direct gateway into China’s domestic payment and liquidity system, allowing eligible cross-border transactions to be settled directly in yuan rather than routed through the US dollar.
The bank processed about $500 million in RMB transactions during its first four months on the platform, underscoring growing demand for yuan-based settlements between Africa and China.
A few weeks ago, during a government meeting to boost economic cooperation with China, Egyptian Prime Minister Mostafa Madbouly said that Chinese investment in Egypt **had surpassed $10 billion**.
According to the Egyptian official, the milestone highlights the growing investor confidence in the country's economic ecosystem and the expanding presence of Chinese businesses in Egypt.
Madbouly stated that economic cooperation between both countries has continued to strengthen under both nations' leadership, supporting Egypt's development goals while furthering mutual commercial interests.
Very recently, both countries began exploring a major economic partnership that could bring up to $2 billion in new investment into the region.
This proposed initiative would establish a massive, integrated industrial complex in Egypt's Suez Canal Economic Zone (SCZONE), a subject that was discussed during Mr.Jinping’s visit.
“I take this opportunity to announce the agreement to launch the third phase of expansions of the Egyptian-Chinese industrial zone in the Suez Canal Economic Zone, which launches a new phase of business in key sectors such as renewable energy, automobile manufacturing, textiles and chemical fibres,” Egyptian President Abdel Fattah al-Sisi said at the start of bilateral talks.