FINANCIAL CHRONICLE – The central banks of Sri Lanka and China have engaged in discussions aimed at facilitating trade settlements in renminbi during the IMF-World Bank Spring Meetings 2026 held in Washington. The talks involved Nandalal Weerasinghe, the Governor of the Central Bank of Sri Lanka (CBSL), and Pan Gongsheng, the Governor of the People’s Bank of China.
According to CBSL, the conversation addressed the increasing geopolitical tensions and highlighted the ongoing collaboration between the two financial authorities. It was noted that promoting trade settlements in renminbi could yield significant advantages for economic exchanges between China and Sri Lanka.
Weerasinghe took the opportunity to update Gongsheng on the latest economic developments in Sri Lanka, particularly the challenges arising from escalating tensions in the West Asia region.
China has been actively working towards the internationalization of the renminbi (also known as the Chinese yuan or CNY) as part of a long-term strategy aimed at decreasing its reliance on the US dollar, improving trade efficiency for Chinese businesses, and enhancing its financial clout globally.
The Chinese government has established bilateral local-currency swap agreements with more than 40 central banks, accumulating a total of over ¥4 trillion. It has also promoted renminbi-denominated contracts for oil and commodities on the Shanghai International Energy Exchange, and has encouraged countries within the BRICS and the Belt and Road Initiative to conduct trade invoicing and maintain reserves in renminbi.
In related developments, the Colombo Port City is set to become a special economic zone that will operate on a ‘dollarized’ basis, allowing various currencies to compete, including those of the Federal Reserve (US dollar), the European Central Bank (Euro), and the People’s Bank of China (Renminbi).
Additionally, Weerasinghe met with Sanjay Malhotra, the Governor of the Reserve Bank of India, during the IMF-World Bank Spring Meetings to discuss initiatives aimed at promoting the use of the Indian rupee for trade and tourism purposes.
