Chinese Forex Swaps

renminbi currency agreements in the context of the belt and road initiative

Abstract

This paper aims to discuss the Chinese Central Bank, the People’s Bank of China (PBOC), swap agreements in the One Belt One Road (OBOR) context by identifying their interconnection with to South-South Cooperation SSC tenants and values. China has a project for global economic and geopolitical expansion, the OBOR, which is based on SSC tenants and values, therefore attract many countries. In this context of OBOR, the Chinese currency internationalization were driven by a necessity for China to deal with 2008 financial crises aftermath and to increase its own currency usage with another countries. The article main question was; In which way the PBOC’s swap agreement within OBOR context, are compatible with the SCC characteristics? To answer this question, a plausibility probe case study was conducted to identify the existence of a connection between swap agreement in the OBOR context and CSS values. Even though was not possible to access the actual agreements and its detailed content, it was possible to identify that chineses relations and agreements in OBOR context has SSC values such as  the preservation of sovereignty, non-intervention and mutual gains.