On October 10, Daily Asia published an interview with the Governor of the National Bank of Cambodia, Serey Chea, about the positioning of the Cambodian digital payment system, monetary policy and ¡°dollarization.¡±

Xie Silei said that many countries in the region are promoting local currency trade settlement, and the RMB cross-border payment system (CIPS) can facilitate trade settlement with China. Although the use of US dollars is convenient, it also exposes certain limitations. She said that she prefers to use the term "expanding the use of local currency" rather than "de-dollarization", and Cambodia does not seek to eliminate the US dollar from the economy in the short to medium term.

In recent years, progress has been made in the field of digital payments in Cambodia.The data show that the total annual transactions of Cambodia's national payment system Bakong have reached the country's gross domestic product (GDPStatistics of the National Bank of Cambodia (NBC) show that the total transaction volume of the Bakong System in 2024 reached $1506.1 billion, equivalent to 330% of Cambodia's GDP.

"With digitalization... many things can move forward quickly, and Cambodia knows how to achieve leapfrog development." Xie Silei said that Cambodia has a large number of banks, professional banks, payment service providers, microfinance institutions and professional procurement companies. Most of these institutions have their own mobile applications, but they are not connected to each other. Therefore, when designing Bakong, the model of "all banks connected to the core system and realizing interconnection of all employees" was adopted.

Xie Silei, Governor of the National Bank of Cambodia

She added that this new system has really greatly promoted the use of the local currency (riel). "In the past, you might have to carry a lot of cash when you went to a restaurant to pay. Now, through electronic payment, the burden is much lightened. We are still trying to cooperate with neighboring countries."

The journalist subsequently mentioned that Cambodia was influenced by both the U.S. and China¡¯s two superpowers, encouraging the use of Reir¡¯s policies for the purpose of ¡°dollarization¡±?

Xie Silei said she does not tend to use the term "de-dollarization".

"Why do I only say 'expand the use of local currency', not' de-dollarization'? Because 'de-dollarization' means removing the dollar from the economy, this is neither our short-term goal nor the short-term goal, but a long-term goal."

¡°Our policy principle is that if people are willing to use their currency, we will support it; but never force it because when you force people to use currencies they don¡¯t want to accept, it¡¯s likely that there will be a huge black market.¡±

¡°We encourage people to choose Reel by improving the convenience of using the currency, for example by making the use of the currency wider and making payments easier.¡±

The Nikkei reporter then asked: Cambodia is seeking to participate in China's RMB cross-border payment system (CIPS). In the choice of settlement currency, does Cambodia prefer the US dollar or the RMB?

¡°CIPS is a system specifically used for RMB settlement. If I don¡¯t have CIPS, I still need to use Western payment infrastructure if I want to pay to Chinese investors. But if I want to pay in RMB in China, I can complete the settlement through CIPS without having to go through the international fund settlement system SWIFT.¡±

¡°This is my understanding, and I am not speaking on behalf of the Central Bank of China, but standing in the position of Cambodia.¡±

Shearer believes that the question of whether to participate in the CIPS is not an urgent matter for Cambodia.

¡°I think every country in the region is pushing forward the domestic currency trade settlement initiative, and we hope that trade between countries can use each other¡¯s domestic currency settlement.¡±

On September 16, the deputy governor of the People's Bank of China, Lu Li, attended the 14th China Payment Settlement Forum, said that in recent years, the high-level bilateral opening has made positive progress, the expansion of the RMB payment business has increased, and the RMB cross-border payment system CIPS business covers 189 countries and regions worldwide, and in the first half of this year the total number of operations has reached 402.95 million units, the business amount of 90.19 trillion yuan, which has become an important support force for the internationalization of the RMB.

Shearer mentioned in an interview that, to some extent, Cambodia had to adapt to U.S. monetary policy.

She pointed out that the recent high inflation in the U.S. led the Federal Reserve to decide to raise interest rates. Since the dollar interest rates are now very high, Cambodian investors have to pay higher interest rates, this is entirely a ¡°passive response¡± situation. This external shock makes people realize that while using the dollar is convenient, it exposes its limitations whenever instability or crisis occurs, and we need the central bank to play a leading role.

When talking about the trend of multipolarity in the international monetary system, Xie Silei said that this is the general trend of world development. Right now, all countries are aware of the need for a certain degree of monetary independence, diversification and avoidance of over-reliance on a single currency. But how fast the process will take remains uncertain.

¡°I think it will take a long time,¡± she said, ¡°because it involves changing patterns of behavior, changing ways of thinking, and will be influenced by many factors.

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