Dhe Chinese participants describe it quite impressively: If you go shopping in China now, you no longer take your wallet with you, not even for credit cards – just your smartphone. In any case, it is only thanks to the mobile phone with its extraordinary possibilities that China got out of the corona crisis so quickly and is showing impressive growth rates again ahead of most other countries in the world, says Jianguang Shen, a former economist at the European Central Bank today works for the Chinese online shopping giant JD. “There was no lockdown for shopping with smartphones – the open attitude of people in China towards everything digital has therefore led to a particularly strong boost for digitization during the pandemic.”
It was the differences, despite all the parallels, that made a joint conference of the Bundesbank and the Chinese central bank on fintechs, artificial intelligence and digital money on Tuesday so exciting. The format itself was remarkable: In China, the conference participants met again physically, but overall they were connected as a video conference. Bundesbank President Jens Weidmann regretted how much he would have liked to show the Chinese participants the money museum in Frankfurt in normal times.
China is the digital pioneer
In his opening speech, the Bundesbank President put the digital euro at the center: Weidmann, as it were, honored the guests from the Far East with the fact that China has the edge when it comes to digital central bank currencies and that Germany and the euro zone as a whole are therefore very interested in an exchange with the Chinese be: “The People’s Bank of China has played a pioneering role in the development of such a digital currency, and we look forward to new insights into their projects.”
The European Central Bank (ECB) ‘s own project, the digital euro, received somewhat thoughtful words from Weidmann. In July, the ECB decided to take a more in-depth look at this project and estimated it to take around five years to complete. Weidmann pointed out that one had to keep an eye on the effects on the banking system as well as the worries and fears of the people. In any case, it has so far only been vaguely apparent what such digital money could look like. Weidmann warned against too high expectations: “The digital euro may not be an all-rounder.”
Weidmann described a field of tension between opportunities and concerns. On the one hand, the digital euro could bring people more security. Consumers and companies could then pay with central bank money in a digital environment. “This is a unique feature that the private sector cannot replicate.” Unlike traditional bank balances, central bank money would not be at risk in the event of bank failures and financial crises.