Editor’s note: Matteo Giovannini is a finance professional at the Industrial and Commercial Bank of China in Beijing and a member of the China Task Force at the Italian Ministry of Economic Development. The article reflects the author’s views, and not necessarily those of the West Commercial Bank .

Last June, the People’s Bank of China (PBOC) gave the green light to the issuance of a license to Express (Hangzhou) Technology Services Co., a joint venture between American Express and Lianlian DigiTech Co. Ltd, to start bank card clearing services on the Chinese mainland in a move that made of the American multinational financial services corporation the first foreign payments network to be allowed to process local currency transactions in a market valued at 27 trillion U.S. dollars in terms of mobile transactions.

Starting from last week, several Chinese commercial lenders including Minsheng Bank, Guangfa Bank, Ping An, Shanghai Pudong Development Bank, and China Merchants Bank have started to launch on the market American Express cards that can be now used to settle bills in Chinese renminbi both inside and outside of China in a change from previous rules that allowed offshore card transactions to be settled only in foreign currencies.

By giving the possibility to foreign companies to operate in Chinese currency inside and outside the country, China’s ultimate goal is to integrate its domestic payment services, still largely dominated by local players such as Union Pay, Alibaba’s Alipay, and Tencent’s WeChat Pay, with the world’s financial system and to promote a global yuan clearing and settlement system that could eventually support trade and investment transactions between China and the rest of the world.

The PBOC’s decision on American Express is not expected to be an exception, but the beginning of a real opening-up process since the other two major global bank card corporations are on the way to get on board with Mastercard that has already received approval for bank card clearing operations in the Chinese mainland and with Visa that has submitted an application and is currently waiting for approval.

In this sense, the Chinese regulator’s decision is strategically important because it sends a clear signal to the market that, even though ever-growing tensions characterize the relationships with the U.S., China is unwilling to adopt any retaliation against the business of American companies.

On the contrary, it aims to further elevate the global relevance of its huge financial market by providing more access to foreign firms that could eventually increase the sophistication and expertise of the Chinese market while promoting the internationalization of the yuan overseas.

The decision to allow American Express to clear transactions in yuan both inside and outside of China, together with the cooperation between the U.S. company and leading Chinese mobile wallet providers, is going to be very welcome from the one hand by Chinese tourists going abroad for being able to make payments in their own currency using familiar payment ecosystems normally used at home and on the other hand by foreign tourists visiting China that could rely on a digital wallet for their daily transactions in China avoiding the complexities of changing cash at arrival and departure.

In addition, the possibility to leverage the extended cross-border international network of the American Express cards around the world, that just in the United States make up nearly a quarter of all credit card transactions, is going to serve as a springboard for the further utilization of the Chinese yuan well-beyond the Belt and Road Initiative (BRI) boundaries and in this way to help to support its internationalization development process.

China’s decision to give American companies more access to its clearing network can also be read with a political lens, since besides an increased circulation of yuan abroad that will eventually enhance the country’s role in global finance, it has the real ultimate goal to reduce China’s reliance on the U.S. dollar payments system while hedging the risk, at a time of unpredictable consequences, of receiving similar financial sanctions to those imposed to Russia, Iran, the DPRK, and Venezuela.

In this regard, it has been reported by Nikkei Asian Review that China is partnering with Russia to reduce their dependence from the U.S. dollar in a move branded as “financial alliance” and that only in the first half of this year has reduced for the first time the dollar’s share of trade between the two countries to below 50 percent with an increase in euro and their respective national currencies.

At the center of this alliance is America’s leading role in global finance, that relying on the status of the dollar as the world’s reserve currency and the absolute control of the Belgium-based Worldwide Interbank Financial Telecommunication (SWIFT) messaging system, provides Washington the possibility to monitor every global transaction and to unilaterally impose sanctions on countries and companies that use the dollar in their transactions.

China launched the Cross-Border Interbank Payment System (CIPS) in 2015, a financial messaging network for cross-border transactions between the Chinese mainland and the two special administrative regions that also serves in the effort to internationalize the use of the yuan but it is not easy to walk away from the SWIFT system that is accepted worldwide, and it is probably more of a long-term plan.

The urgency that comes from the concrete risk to be cut off from the dollar payment system, in the event of further escalating tensions with the U.S., gives China no other alternative than to find other ways to reduce its reliance on the dollar that nowadays represents more of a liability than an asset.

Opening-up the domestic market to foreign credit cards firms allowing settlement of bills in Chinese renminbi onshore and offshore, making China’s currency more traded in international transactions, together with continuing to develop digital financial infrastructure and to expand pilot tests for a government-backed digital yuan for cross-border payment system are all decisions that while attempting to affect the dominance of the U.S. dollar will also help China to emerge as a major global financial power.