China France File photo: cnsphoto

 
The cooperation between China and France on the RMB Cross-Border Interbank Payment System will help with internationalization of the yuan and will also provide an opportunity for the eurozone to reduce its reliance on the US dollar, experts said.

China has agreed to support more French banks and financial infrastructure in joining the RMB Cross-Border Interbank Payment System, which was a highlight of multiple important agreements on bilateral cooperation agreed on by the two sides on Wednesday.

The Chinese side will review in a positive manner French banks' applications for financial qualifications in accordance with relevant procedures and standards, Xinhua reported.

The RMB Cross-Border Interbank Payment System between China and France is needed for bilateral trade, Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology, told the Global Times on Thursday.

The cooperation between China and France has yielded fruitful results. Last year bilateral trade exceeded $80 billion, and China's total imports of agricultural products from France increased by 40 percent year-on-year.

Dong noted that France could first accept the yuan as a payment currency to carry out RMB cross-border settlement and investment. As a next step, France could add the yuan to its reserve currency list and increase the proportion of the yuan in France's foreign exchange reserves. 

“It is expected that the cooperation between China and France will set an example for other countries in the eurozone to accept the yuan as a reserve currency and diversify their foreign exchange reserves to avoid risk,” he noted.

According to SWIFT's latest report, the share of the yuan in international payments rose to 3.20 percent in January from 2.70 percent in December 2021, breaking the previous record set in 2015. The global ranking of the yuan in international payments remains fourth in the world.

Aside from cooperation in the financial sector, the two sides have also agreed to push for early implementation of cooperation on agricultural technology and between agricultural industries with local advantages. The Chinese side is encouraging more French agrifood enterprises that meet the necessary requirements to register in China.

The agricultural cooperation between France and China is deeply rooted. France's high level of marketization in the agricultural industry, as well as its advanced technology and nutritious agricultural products are in line with China's rural revitalization strategy, Zhou Rong, a senior researcher at the Chongyang Institute for Financial Studies at Renmin University of China, told the Global Times on Thursday.

The two sides have also agreed to deepen the China-France green manufacturing partnership initiative and to each provide a fair, equitable and non-discriminatory business environment. They will also support aviation enterprises from both countries in deepening cooperation in various forms, and promote mutual airworthiness certification for aircraft.