The initiative emphasizes knowledge sharing, expertise, and employee competencies through joint training and research projects. The partnership between the People’s Bank of China (PBoC) and the National Bank of Kazakhstan (NBK) aligns with the global interest in Central Bank Digital Currencies (CBDCs). As per the agreement, the two central banks will collaborate on CBDC development and implementation, conduct joint research projects, and enhance the skills of employees involved in CBDC research and development.
The development of a CBDC is anticipated to enable faster, more secure, and cost-effective cross-border transactions, crucial for international trade and economic integration. Collaborative CBDC development between China and Kazakhstan is seen as a potential driver for increased economic efficiency, reduced transaction costs, and improved financial inclusion. However, the adoption of CBDCs faces strong competition from established digital payment platforms such as Paytm and Google Pay, which have garnered wide popularity among users.
Notably, central banks in Indonesia and Thailand have initiated projects to launch digital currencies – the e-rupiah and the Retail Central Bank Digital Currency (CBDC-R), respectively. The Bahamas and eight member countries of the Eastern Caribbean Central Bank have already implemented CBDCs, with the Sand Dollar and DCash being in use. The Riksbank in Sweden has been piloting its e-krona CBDC since 2020 to ensure continued provision of a state-backed payment method in a digital world.
Additionally, the U.K is exploring the launch of a CBDC, with a focus on complementing cash and bank deposits.