KARACHI: Asad Muzaffar, a senior member of the Prime Minister’s Special Task Force, former Chief Coordinator for China-Pakistan Economic Corridor (CPEC) Special Economic Zones (SEZs) Punjab, and former Resident Director of China Railways Bureau 17th Group, believes that the real battle shaping today’s geopolitical landscape extends far beyond conventional warfare.
In an opinion shared with The Financial Daily, Muzaffar argues that while conflicts in the Middle East are often viewed through the lenses of ideology, regional security, energy resources, military competition and technological advancement, these represent only the visible dimensions of a much deeper global contest.
According to him, the underlying struggle is centred on the future of the international financial system and the competing frameworks governing cross-border payments, reserve currencies and financial influence.
Currency Systems at the Centre
Muzaffar contends that the conflict is fundamentally linked to what he describes as the “weaponisation of financial plumbing,” with the US dollar and the SWIFT international payments network occupying the central position.
He argues that recent geopolitical developments have reinforced the dominance of the US dollar within the SWIFT ecosystem, enabling it to recover market share from other major currencies, including the euro and the British pound.
At the same time, he believes these developments have complicated efforts by BRICS nations to establish alternative payment arrangements. He notes that differing official positions adopted by BRICS members have exposed divisions within the grouping, particularly regarding proposals aimed at reducing reliance on the dollar.
China’s Strategic Position
Discussing China’s financial strategy, Muzaffar says that although the Cross-Border Interbank Payment System (CIPS) exists as China’s international payments infrastructure, it continues to maintain operational links with SWIFT.
According to him, Beijing has increasingly promoted settlement in the Chinese Renminbi (RMB), particularly in energy trade, while simultaneously expanding bilateral arrangements with key regional partners. He argues that these developments have strengthened the international role of the RMB alongside the continued global dominance of the US dollar.
He also maintains that China’s electric vehicle industry has continued to strengthen despite growing trade restrictions imposed by Western economies.
Europe and the Financial Architecture
Muzaffar further argues that differences between the United States and Europe over financial governance have become increasingly significant.
He points out that SWIFT operates as a cooperative financial messaging system under Belgian oversight and is supervised by G10 central banks. According to his assessment, CIPS was originally connected to SWIFT to facilitate European trade with China while operating under a different regulatory framework from that of the US Federal Reserve.
He believes this structure has created an increasingly complex environment in which multiple financial systems now coexist, each reflecting broader geopolitical interests.
The Next Phase: Digital Currency Competition
Looking ahead, Muzaffar identifies the competition between Project Agora and the Multi-Central Bank Digital Currency (mCBDC) initiative as the next major battleground in global finance.
He describes Project Agora as an initiative involving G7 central banks, while noting that the mCBDC framework includes participation from countries such as Saudi Arabia, the United Arab Emirates, Hong Kong and Thailand, alongside a growing number of observer states.
In his view, the contest between these competing digital payment architectures will play a defining role in shaping the future international monetary system.
Economic Competition Beyond Trade
Muzaffar also links recent tariff measures, technology export restrictions, semiconductor controls and limitations imposed on several leading Chinese technology companies to what he considers a broader strategic competition.
He argues that China has responded by accelerating domestic production capabilities and strengthening indigenous technological development across multiple sectors, including semiconductors, electric vehicles and advanced manufacturing.
A Fragmenting Global Order
Drawing on academic and strategic literature, including concepts such as “bifurcated globalisation” and “wedge diplomacy,” Muzaffar believes the world is entering an era of increasingly divided economic and geopolitical systems.
He suggests that governments and businesses should prepare for a prolonged period of structural change, where competing financial, technological and geopolitical blocs may increasingly operate in parallel rather than within a single integrated global order.
Despite these challenges, Muzaffar concludes on a cautiously optimistic note, emphasising that policymakers, businesses and investors must approach the evolving international landscape with both pragmatism and resilience.
“The global order is undergoing a profound transformation. In this period of structured disruption, optimism and strategic thinking will be essential to navigating the new realities of the world economy.” Asad Muzaffar tells The Financial Daily.
Report by : Muhammad Umar Waqqas
