London Daily

Focus on the big picture.
Tuesday, Sep 09, 2025

China’s SWIFT joint venture a ‘defensive move’ in US financial war

China’s SWIFT joint venture a ‘defensive move’ in US financial war

China’s latest joint venture with the Belgium-based SWIFT financial messaging service is a “defensive move” amid ongoing tensions with the United States, highlighted by last week’s fractious talks in Alaska.

China’s central bank on Tuesday announced that a newly established joint venture with SWIFT and four Chinese institutions will offer localised financial services to make cross-border transactions more stable and secure.

The decision to set up the joint venture with SWIFT comes amid souring of global relations with the United States, the European Union, Britain and Canada imposing sanctions on several Chinese officials for human rights abuses against the Muslim Uygur minority in China’s Xinjiang province, prompting retaliation from China.

The US will not accept that the world is changing and will keep imposing sanctions and escalate the financial war

Oriol Caudevilla


“Many people had expected that now with [US President Joe] Biden, things would be different, but we saw last week in Alaska it is actually still the same. To the US, China is a threat and needs to be undermined in every possible way,” said Oriol Caudevilla, strategic adviser at Alpha Bright Asset Management and fellow at the Digital Euro Association.

“The US will not accept that the world is changing and will keep imposing sanctions and escalate the financial war. This may affect China and may be a concern for China, and the joint venture is a defensive move.”

As China’s financial industry continues to open up to the outside world, more domestic institutions use the global financial network and information services provided by SWIFT.

But some Chinese medium and small-sized banks have reported unstable connectivity to the SWIFT network, affecting their cross-border transactions, the People’s Bank of China (PBOC) said.

The cooperation between SWIFT and Chinese-funded institutions is mutually beneficial with win win results

People’s Bank of China


The new entity will operate financial messaging services through a local network and set up a localised data warehouse to monitor and analyse cross-border payment messaging, the PBOC added.

“The cooperation between SWIFT and Chinese-funded institutions is mutually beneficial with win win results,” the PBOC said. “In the next step, supervision and guidance will be strengthened to promote the standardised development in all aspects of the financial gateway business.”

Chinese researchers and former officials have long been urging Beijing to make preparations for the worst-case scenario if tensions spiral out of control and the US imposes economic and financial sanctions to isolate Chinese banks and companies from the US dollar-dominated international markets.

But it remains unclear at this stage whether by operating a local network and setting up a localised data warehouse, the new joint venture with SWIFT can help circumvent the US sanctions by enabling Chinese companies to realise netting settlement services for their cross-border payments.

The SWIFT system has in the past afforded Washington broad powers to prohibit foreign countries from using the US dollar payments and clearing systems or restrict the US banking industry’s business dealings with them, leaving them unable to receive payments for exports, pay for goods or own US dollar-denominated assets.

Earlier this year, SWIFT established a Chinese joint venture, Finance Gateway Information Service, with the China National Clearing Centre, a wholly-owned domestic settlement subsidiary of the PBOC.

The joint venture also involves China’s home-grown cross-border settlement system, Cross-border Interbank Payment and Clearing (CIPS), the Payment and Clearing Association of China, a self-regulatory association for the payments industry, and the PBOC’s Digital Currency Research Institute.

Zhang Xiaohui, the former director of the monetary policy department of China’s central bank, last year said that Chinese financial entities are worried by the threat of the US’ long-arm jurisdiction hindering their US dollar settlement and clearing channels.

Comments

Oh ya 4 year ago
SWIFT should have told the US that they are a neutral company that can not be used to sanction anyone and anyone interfering with their business model will themselves be removed. But that would involve someone growing a pair

Newsletter

Related Articles

0:00
0:00
Close
Court Staff Cover Up Banksy Image of Judge Beating a Protester
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
Elon Musk Poised to Become First Trillionaire Under Ambitious Tesla Pay Plan
France, at an Impasse, Heads Toward Another Government Collapse
Burning the Minister’s House Helped Protesters to Win Justice: Prabowo Fires Finance Minister in Wake of Indonesia Protests
Brazil Braces for Fallout from Bolsonaro Trial by corrupted judge
The Country That Got Too Rich? Public Spending Dominates Norway Election
Nearly 40 Years Later: Nike Changes the Legendary Slogan Just Do It
Generations Born After 1939 Unlikely to Reach Age One Hundred, New Study Finds
End to a four-year manhunt in New Zealand: the father who abducted his children to the forests was killed, the three siblings were found
Germany Suspends Debt Rules, Funnels €500 Billion Toward Military and Proxy War Strategy
EU Prepares for War
BMW Eyes Growth in China with New All‑Electric Neue Klasse Lineup
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
US Justice Department Launches Criminal Mortgage-Fraud Probe into Federal Reserve Governor Lisa Cook
Escalating Drug Trafficking and Violence in Latin America: A Growing Crisis
US and Taiwanese Defence Officials Held Secret Talks in Alaska
Report: Secret SEAL Team 6 Mission in North Korea Ordered by Trump in 2019 Ended in Failure
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Florida Murder Case: The Adelson Family, the Killing of Dan Markel, and the Trial of Donna Adelson
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Big Tech Executives Laud Trump at White House Dinner, Unveil Massive U.S. Investments
Tether Expands into Gold Sector with Profit-Driven Diversification
‘Looks Like a Wig’: Online Users Express Concern Over Kate Middleton
Brand-New $1 Million Yacht Sinks Just Fifteen Minutes After Maiden Launch in Turkey
Here’s What the FBI Seized in John Bolton Raid — and the Legal Risks He Faces
Florida’s Vaccine Revolution: DeSantis Declares War on Mandates
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
"The Situation Has Never Been This Bad": The Fall of PepsiCo
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
The Fashion Designer Who Became an Italian Symbol: Giorgio Armani Has Died at 91
Putin Celebrates ‘Unprecedentedly High’ Ties with China as Gazprom Seals Power of Siberia-2 Deal
China Unveils New Weapons in Grand Military Parade as Xi Hosts Putin and Kim
Queen Camilla’s Teenage Courage: Fended Off Attempted Assault on London Train, New Biography Reveals
Scottish Brothers Set Record in Historic Pacific Row
Rapper Cardi B Cleared of Liability in Los Angeles Civil Assault Trial
Google Avoids Break-Up in U.S. Antitrust Case as Stocks Rise
Couple celebrates 80th wedding anniversary at assisted living facility in Lancaster
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
The White House on LinkedIn Has Changed Their Profile Picture to Donald Trump
"Insulted the Prophet Muhammad": Woman Burned Alive by Angry Mob in Niger State, Nigeria
Trump Responds to Death Rumors – Announces 'Missile City'
Court of Appeal Allows Asylum Seekers to Remain at Essex Hotel Amid Local Tax Boycott Threats
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
×