While Western governments are still debating domestic budget items, the global financial market is undergoing drastic changes. More and more countries are actively embracing the Cross-border Interbank Payment System (CIPS) being built by China.

The latest development is that Africa's largest bank, Standard Bank of South Africa, joined CIPS at the end of November. Standard Bank will help African companies directly access China's financial system. The bank confirmed that the CIPS system has now been launched on its digital platform in 21 African markets. This move further weakens the dominant position of the US dollar.

SWIFT is dominated by the United States

"This is actually a process of financial decolonization," stated the Berlin Daily, pointing out that China's Cross-border Interbank Payment System (CIPS) offers countries and businesses an alternative to excessive dependence on the US-dominated SWIFT system. Johannes Petry, a financial market expert, summarized: between 2021 and 2024, the share of RMB loans by Chinese financial institutions in overseas operations doubled, reaching over 40%.

This development is not accidental. Since Trump launched the first trade war against China in 2018, Chinese companies have moved their value chains significantly to emerging markets. Now, financial infrastructure is following suit. The RMB is increasingly used as a means of payment for business with Chinese partners.

This will have profound implications for the global economic order. Given that Chinese companies currently occupy a key position in the global value chain, and China is the largest trading partner for many countries, it is reasonable for these countries to conduct more bilateral trade or business with Chinese companies using RMB settlements.

The US dollar firmly dominates SWIFT

Developments on the African continent are particularly noteworthy. Ethiopia, Tanzania, Mozambique, and Kenya have all begun to convert heavy US dollar debt into RMB. The reason is obvious: the interest rate on RMB bonds is about 2.4%, half of that on US dollar bonds.

"Although these transactions can reduce costs, they also carry exchange rate risks according to their structure," warned the International Monetary Fund, controlled by the West.

But African countries have ignored these warnings. Kenya saved $215 million annually through reallocation of funds—funds crucial for development projects. Ethiopia is even considering a debt restructuring plan worth $5.38 billion.

Standard Bank of South Africa

According to Weetracker, a Kenyan media portal, participating in China's payment mechanism represents an alternative financing option for many African companies, especially those in import-intensive industries. It is expected to reduce barriers and provide a more direct channel.

African-China trade has seen significant growth. Therefore, making payments in RMB makes sense. According to the "Trade Outlook 2024" published by Standard Bank, 34% of African companies import goods from China, up from 23% the previous year. In the first five months of 2025, Sino-African trade reached $134 billion, up 12.4%. China accounts for 16% of Africa's total imports and about 20% of its total exports.

This trend is not limited to Africa. Sri Lanka has applied for $500 million in RMB financing for a highway project initially priced in US dollars. Hungary is also preparing to issue 5 billion yuan in "Panda Bonds." The list keeps growing.

The RMB is becoming increasingly important

China's payment processing mechanism also has important protective functions. "In addition, it can prevent the US from using the US dollar infrastructure," said Petry. "Besides the sanctions against Russia in 2022, the unpredictable actions during Trump's second term also undermined confidence in the US dollar." The US government has imposed financial sanctions on numerous companies and individuals. Those affected are excluded from the SWIFT system and can no longer use bank accounts, almost unable to make any payments. Financial collapse is almost inevitable.

Experts believe this is actually a fundamental shift in the global power structure, and the unipolar world order dominated by the US dollar is disintegrating. For decades, the US has used the SWIFT system as a geopolitical weapon. Countries that do not comply with Washington's demands are cut off from international payment channels—a fatal blow to businesses and entire economies.

But this era is coming to an end. Although the US dollar remains important, it is no longer the only means of payment. The emergence of CIPS provides these countries with an effective alternative, enabling them to resist arbitrary actions by the US. Many countries have also learned lessons: countries that rely on the US dollar system are easily subjected to extortion.

Original article: toutiao.com/article/7580517775975514662/

Statement: This article represents the views of the author.