ISLAMABAD, Nov 20 (Wealth Pakistan): China’s 2026–30 financial modernization plan offers Pakistan a major opportunity to upgrade its financial system and strengthen long-term economic cooperation. The Fourth Plenary Session of the 20th Central Committee of the Communist Party of China outlined a strategy focused on high-quality development, institutional reforms, technological innovation and stronger links between finance and the real economy. These priorities closely match Pakistan’s financial-sector needs.
China targets financial stability and governance reforms
A key goal of China’s new plan is to build a stable, flexible and modern financial system that supports technology and industry. The plan stresses stronger financial governance and more effective regulation. These areas are important for Pakistan, where financial institutions continue to face deep structural challenges.
China’s data-driven model of financial supervision could help Pakistan enhance oversight, improve transparency and expand credit access for productive sectors. Better governance would also support Pakistan’s long-term financial stability.
RMB cooperation may ease Pakistan’s dollar dependence
China also plans to improve its currency mechanisms and expand the international use of the renminbi. This creates an opportunity for Pakistan to reduce its reliance on the US dollar.
The existing bilateral currency swap remains underused. However, wider use of the renminbi for bilateral trade could shift payments toward local currencies. This change would ease pressure on Pakistan’s external account and improve payment predictability.
Experts see opportunities in digital finance and long-term funding
Syed Munir Ahmed, Executive Director at Devcom-Pakistan, said Pakistan could diversify funding sources under China’s reform agenda. He noted that aligning Pakistan’s financial practices with China’s regulatory and digital standards would help the country access long-term development finance for energy, environment and technology sectors.
He added that a clear policy direction and a stable investment environment are essential for Pakistan to benefit from China’s next phase of financial engagement.
Green bonds, digital banking and infrastructure finance could attract China
Ahmed also said China is expanding the role of its policy banks and commercial lenders in global development finance. Pakistan could become a preferred partner by updating frameworks for green bonds, digital banking and infrastructure finance.
These areas support energy transition projects, industrial upgrades and digital innovation. They also match China’s wider goals of promoting technological progress, supporting the real economy and advancing environmentally sustainable growth.
China’s fintech success offers lessons for Pakistan
China’s focus on financial technology presents another opportunity. Chinese platforms lead the world in mobile payments, digital credit and online wealth management. Pakistan’s growing fintech sector could benefit from knowledge sharing and investment.
Cross-border digital payment systems could improve e-commerce and remittances. Cooperation in artificial intelligence and big data could also support Pakistan’s financial inclusion programmes.
Risk management remains central to China’s reforms
China is strengthening early-warning systems, digital supervision and regulatory skills. These steps offer guidance for Pakistan, which faces challenges such as non-performing loans, undocumented financial activity and limited credit for small businesses.
China’s technology-driven approach to financial governance can help Pakistan modernize banking oversight and expand credit availability.
Pakistan must modernize its regulatory environment
Dr Hassan Daud Butt, Senior Associate Professor at Bahria University and senior advisor on CPEC affairs, stressed that Pakistan must upgrade its regulatory environment. He said China’s next financial reforms will favor countries with stable policies, transparent regulations and efficient financial institutions.
According to him, Pakistan can play a larger regional role only if it aligns long-term planning with China’s priorities on innovation, industrial finance and digital integration.
Green finance emerges as a major pillar of China’s plan
Hassan added that green finance will become a central feature of China’s upcoming agenda. Pakistan, which faces high climate risks, could work with China to establish joint green funds or issue sovereign green bonds for renewable energy, afforestation, water management and climate-resilient infrastructure.
Such cooperation would support Pakistan’s climate goals and align with China’s green-development commitments.
A roadmap for deeper financial cooperation
China’s 2026–30 financial modernization plan blends stability, innovation and openness. For Pakistan, the opportunity lies in aligning domestic reforms with this direction. Stronger financial governance, digital banking expansion and deeper cooperation with Chinese institutions could help Pakistan secure long-term financial stability and attract investment.
By taking a forward-looking approach, Pakistan can position itself more effectively within a global financial system shaped by China’s next phase of modernization.