(Yicai) July 11 -- The central banks of China and Egypt have signed a memorandum of understanding to strengthen bilateral cooperation, promote the settlement of transactions in local currencies, and collaborate on digital currencies and innovation.

Bilateral cooperation should be strengthened from the perspective of business exchanges and information sharing in areas such as monetary policy frameworks, financial markets, and payment systems, the People's Bank of China announced today, citing the MoU penned yesterday by its Governor Pan Gongsheng and Hassan Abdalla, governor of the Central Bank of Egypt.

The MoU also seeks to enhance cooperation on local currency settlement by promoting the use of local currencies in account transactions and direct investments between the two countries and strengthen collaboration on central bank digital currencies and digital innovation, including information exchange and joint projects.

The MoU will help strengthen communication and cooperation between the two countries and enhance policy coordination, creating a better environment to further unlock the potential of financial cooperation, the PBOC noted.

The cooperation between China and Egypt in the financial and economic fields is progressing well, with bilateral trade steadily increasing, Pan said. In the face of external uncertainties, the central banks of both countries are facing several common challenges, he added.

The two sides should continue to deepen practical cooperation in areas such as bilateral local currency swaps and settlement, payment system connectivity, investment and financing, and establishing financial institutions, according to Pan. This will provide more efficient and convenient services for trade and investment between enterprises, further consolidating and deepening the comprehensive strategic partnership between China and Egypt.

China UnionPay and the Cross-Border Interbank Payment System also signed MoUs with their Egyptian peers yesterday to enhance UnionPay's payment service capabilities in Egypt and encourage banks within the China-Egypt Tianjin Economic-Technological Development Area Suez Economic and Trade Cooperation Zone to conduct cross-border Chinese yuan transactions through the Cross-Border Interbank Payment System.

Editor: Futura Costaglione