Libya and China have agreed to strengthen financial cooperation by connecting Libyan commercial banks to China’s Cross-Border Interbank Payment System (CIPS). As a result, both countries expect faster cross-border payments, simpler financial transactions and stronger bilateral trade. Libya’s Central Bank Governor Naji Issa announced the agreement in a statement on Saturday after holding talks with Chinese officials.
Libyan Banks to Join China’s CIPS Network
Issa said both sides discussed launching a new phase of strategic cooperation between their central banks. “The importance of launching a new phase of genuine strategic partnership between the two central banks was discussed. It was agreed to connect Libyan commercial banks to China’s Cross-Border Interbank Payment System, CIPS, which will simplify financial transfers and make them easier to conduct," Issa said in the Saturday statement. As a result, the agreement will strengthen banking ties and make international financial transfers more efficient.
What Is China’s Cross-Border Interbank Payment System (CIPS)?
The People’s Bank of China launched the Cross-Border Interbank Payment System (CIPS) in 2015. The platform allows banks worldwide to send and receive payments directly in the Chinese yuan. Moreover, CIPS reduces reliance on the US dollar by allowing direct yuan-denominated transactions. It also removes the need for intermediary banks, making international payments faster and more efficient.
Libya and China Plan to Expand Bilateral Trade
In addition, both countries agreed to remove obstacles that slow trade and simplify financial procedures. Libya will also introduce direct money transfers to China. Consequently, small businesses and traders will find it easier to complete international transactions. The move is expected to strengthen commercial ties and increase trade between the two countries.
Businesses Can Open Letters of Credit Through Chinese Banks
Furthermore, Libya and China agreed to allow Libyan businesses to open letters of credit directly through Chinese banks. This step will speed up trade financing and make import and export transactions more convenient for businesses in both countries.
Libyan Banking Delegation to Visit Beijing
Meanwhile, Libya and China agreed to organise an official banking delegation to Beijing. The governor of the Central Bank of Libya will lead the delegation, accompanied by senior executives from Libyan commercial banks. During the visit, Libyan officials will meet their Chinese counterparts to deepen cooperation between the banking sectors of both countries.
Libya to Learn From China’s Digital Payment Systems
According to the statement, the visit will also focus on electronic payment systems and direct financial transfers. At the same time, Libyan officials will study China's banking technology and digital payment systems to improve Libya’s financial infrastructure.
Additionally, these measures aim to reduce reliance on the informal financial market, strengthen compliance with anti-money laundering and counter-terrorism financing standards, and improve the international reputation of Libya’s banking sector.