In China’s Jiangsu province, the e-CNY will be used to pay for services and storage charges for goods supplied under the cross-border Belt and Road Initiative. Moreover, starting this May, civil servants in Changshu will be paid in the digital yuan. There are also plans to expand CBDC use for tax and utility payments in Suzhou in the future.
The municipal government of Suzhou started using the Chinese central bank digital currency (e-CNY) to pay for services related to cross-border railway transportation and storage of related goods. This was reported by the local media.
Thus, the digital currency will be used to service cross-border trade with over 20 countries in Asia and Europe that participate in the Belt and Road Initiative. Suzhou was chosen as the “testing ground” in Jiangsu province, as it’s the starting point for 18 regular cross-border railway lines from China to Europe.
As part of the testing, the municipality of Suzhou also plans to expand its e-CNY application options by adding the ability to pay taxes and utilities with it.
Jiangsu residents received access to the e-CNY in September 2022, and in February 2023, the Chinese government decided that the Suzhou municipality should increase the volume of digital yuan transactions to $300 billion.
Changshu’s administration, which is also located in Jiangsu and falls under Suzhou’s jurisdiction, offers other options for using the e-CNY. According to information published in the state-owned Shanghai Securities Journal, local civil servants and government employees will be paid in the digital yuan from May 2023. For instance, employees at the Changshu city hospital will be able to be paid in the digital yuan through self-service terminals in addition to official CBDC payroll payments.
About 48% of China’s population got access to the CBDC through the integration of the e-CNY into WeChat. In 2022, the volume of the digital yuan in circulation in China amounted to ~$2 billion.
