“Minister Marcelo Montenegro and the president of the Central Bank of Bolivia, Edwin Rojas, meet with the president of the Interbank and Cross-Border Payment System (…), Hongbo Wang (…)”, confirmed the Bolivian Ministry of Economy and Public Finance on its social networks regarding the meeting held this Friday.
The text reported that during the talks, the implementation of this payment system was addressed as a new channel for financial operations in Chinese currency (yuan or renminbi) that can benefit those who carry out trade or other transactions with the Asian nation.
The CIPS is a payment system that offers clearing and settlement services for its participants in cross-border transfers and payments in Chinese currency.
According to a report by the BCB, this payment system arises from the need to transfer money to carry out operations directly between people, companies (public or private) and governments, or with the intervention of financial entities.
According to the authorities, Bolivia is targeting these operations with yuans due to its extensive trade relationship with China, mainly in imports. The bilateral trade relationship gained momentum since 2011, when exports exceeded 300 million dollars and imports 1 billion dollars.
The year 2022 marked an important peak in trade between the two countries, with exports reaching around 800 million dollars and Bolivian imports from China exceeding 1.5 billion dollars.
Already in 2023, “China became Bolivia’s main trading partner -its first seller and third buyer- with a global trade of 3,585 million dollars,” according to the manager of the private Bolivian Institute of Foreign Trade (IBCE), Gary Rodríguez.
On January 7 of this year, the Bolivian ambassador to China, Hugo Siles, described the bilateral relationship as “robust” and assured that both parties are developing a strategic agenda for industrialization and regarding the use of the yuan in commercial operations.
The diplomat assured in an interview with ATB Radio that in the context of the industrialization policy with import substitution promoted by the Government of President Luis Arce, a bilateral strategy is being worked on.
“Last year, the Central Bank of Bolivia -Siles recalled- signed different memorandums of understanding with the People’s Bank of China (and) with financial institutions in China,” he added regarding payments in yuan and bolivianos.
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