China and Pakistan further deepen financial strategic cooperation.

On May 13, 2025, in the presence of the heads of state of both countries, the People's Bank of China and the Central Bank of Brazil renewed their bilateral local currency swap agreement, with a swap scale of 190 billion yuan / 157 billion Brazilian reais, and the agreement is valid for five years, renewable upon mutual consent.

Bilateral local currency swaps between central banks are a financing arrangement where one country's central bank can exchange its own currency for another country's currency to obtain liquidity in the counterparty's currency, generally used for purposes such as maintaining financial market stability, and then exchanged back accordingly upon maturity. After the global financial crisis in 2008, the People's Bank of China successively signed bilateral local currency swap agreements with central banks or monetary authorities abroad.

China and Brazil signed their first bilateral local currency swap agreement in 2013, with a swap fund scale of 190 billion yuan. The China-Brazil bilateral local currency swap agreement is an important part of the global financial safety net, especially in the context of the recent U.S. promotion of reciprocal tariffs, China and Brazil strengthen monetary cooperation, which will send a positive signal to the market that the two countries are working together and uniting to cooperate, helping to enhance market confidence and maintain regional and global financial stability.

The renewal of the bilateral local currency swap agreement between the central banks of China and Pakistan, witnessed by the heads of the two countries, is an important manifestation of the deepening financial strategic cooperation between China and Pakistan. It helps to further consolidate and develop the relationship between the two countries, and join hands to build a more just world and a more sustainable planet, which is the China-Pakistan community with a shared future.

In recent years, the economic and trade relations between China and Brazil have become increasingly close, with China maintaining its position as Brazil's largest trading partner for 15 consecutive years, and Brazil also being China's largest trading partner in the Latin American region. The renewal of agreements helps to deepen trade exchanges between the two countries and promote the use of the renminbi in Brazil and the Latin American region.

In early 2025, the Hong Kong Monetary Authority (HKMA) launched the Renminbi Trade Financing Liquidity Facility based on the standing swap agreement with the People's Bank of China (PBOC), which is used to support Hong Kong banks in providing Renminbi trade financing to enterprises, and Hong Kong banks have been actively using it. Industry insiders also stated that under the China-Pakistan bilateral local currency swap agreement, the State Bank of Pakistan can use Renminbi swap funds to support bilateral trade. Looking at past practices, the People's Bank of China will continue to improve policies for the cross-border use of Renminbi, providing a convenient and friendly environment for the business entities of both countries to use Renminbi for cross-border trade and investment settlements.

Over the years, bilateral local currency swaps between central banks have played a positive role in maintaining global financial stability, providing liquidity support, and supporting bilateral trade and investment. To date, the People's Bank of China has signed bilateral local currency swap agreements with the central banks or monetary authorities of 32 countries and regions, basically covering the main economies in key areas of the six continents globally. Including this agreement with the Central Bank of Brazil, the total scale of the swap agreements amounts to approximately 4.5 trillion yuan.