Financial expert Khaled Al-Zantouti stated, in a remark to our source, that the CIPS system is a Chinese interbank system for payments and settlements of transactions in Chinese yuan, and is considered a competitor to the American SWIFT system, which operates in dollars.
He explained that this system emerges as a tool to facilitate and encourage Chinese exports, and also to avoid reliance solely on the dollar in international transactions—especially after the 2008 crisis and the bankruptcy of many major American financial institutions, which China saw as an opportunity to introduce this system globally and promote the yuan in international transactions as a step toward its internationalization as a currency backed by the world’s second-largest economy.
Al-Zantouti added that the meeting between the Governor of the Central Bank of Libya and his Chinese counterpart to introduce the CIPS program as a means for commercial dealings with Libya holds particular importance, as it would facilitate transactions with China, Libya’s largest trading partner.
He emphasized that this would encourage Libyan traders and commercial banks to expand dealings with China, in addition to reducing commissions and certain other costs compared to the currently dominant SWIFT system, describing the step as positive.
He also pointed to the possibility of establishing special arrangements through this system to facilitate Libyan oil exports to China, while also easing and increasing trade exchange with it in yuan and according to market prices.
