Central Bank Digital Currencies: Opportunity For Developing A New, Just And Equitable Global Payment System

Digitalization is provoking meaningful changes in the sphere of the monetary system to the point where the IMF (2022) has referred to them as a “money revolution”. At least 105 countries are currently studying the possibility of implementing a Central Bank Digital Currency (CBDC). Discussions about the international usage of CBDCs are gaining momentum. In fact, there is a general perception of the dysfunctionality of the current international payment system. The reasons are diverse, but firstly, the international migrants pay exorbitant fees for their remittances; secondly, the SWIFT platform can be used as an international economic warfare instrument. The advent of CBDCs and corresponding changes in the global infrastructure for international payments are then expected to have important consequences for the world economy. Discussions are still in the early phase regarding these developments, so it is a proper moment for a concerted effort aimed at erecting a financial architecture that fulfils the role of a “global public good”. The main problem, however, is that countries are tempted to enter into a race for the development ofsystems that respond to their own national interests. The Bank for International Settlements is coordinating pilot-projects for cross-border payment systems. Yet, the discussions are rather devoted to the creation of faster and cheaper services, with no concern for political aspects. This policy brief proposes a joint-policy of the G20 Central Banks aimed at developing a CBDC’s international payment system which can: i) reduce the asymmetries of the International Monetary and Financial System (e.g., by enabling the use of diverse national currencies and eliminating exorbitant fees for international payments); ii) foment green finance (especially due to the traceability and the possibility of accumulation of gigantic realm of data related to investments and consumption).