China And Russia CUT TIES With The Dollar | Triggers Global Currency Exodus
China And Russia CUT TIES With The Dollar | Triggers Global Currency Exodus
#china #russia #economy
So, you know how people have been talking about the whole de-dollarization thing for a while now? Well, guess what? It’s finally starting to gain some serious momentum! Over the past few years, especially since 2008, there have been a bunch of events that have made the dollar less important on the world stage.
Countries all over the place are ditching the dollar and trying out some other currencies for their business deals.It’s not just one or two countries doing this, either. Latin America, Asia, Africa—they’re all hopping on the de-dollarization train.
And you know what else? Gold is becoming super popular again, and currencies like the yuan are getting a lot more attention in international trade.
If You Like This Video; Like, Share, Comment And Subscribe. This Means A Lot To Us!
Thanks For Watching Our Video; China And Russia CUT TIES With The Dollar | Triggers Global Currency Exodus
In 2021, China’s trade numbers reached an incredible USD 6.064 trillion, which is nearly 30% higher than what the United States managed with its USD 4.691 trillion. But that’s not all. The gap between China and the U.S. has been getting wider, thanks to the U.S. trade deficit with China. It’s like China is winning in every corner of the world.
Almost every country out there has made China their main trading partner. Aside from that, in 2022, Chinese transactions in their currency, the yuan, were even higher than those in American dollars.
According to Bloomberg, the U.S. dollar’s share of China’s international trade dropped from 48.6% in February to 47%. It’s like the U.S. dollar is losing its lead factor while China is stealing the show.
After the U.S. slapped some sanctions on Russia for its involvement in Ukraine, it caused Russia a whole bunch of money. And you know what happened next? A lot of countries intensified the de-dollarization.
Russia got pretty serious about de-dollarization recently. Putin himself signed this fancy executive order in March 2022, saying that countries they don’t get along with can’t sign natural gas contracts using any currency other than the ruble.
And now, this trend is gaining even more momentum. Brazil and Argentina, in January 2023, said that they were prepping to trade using their currencies. Also, Iraq decided on February 21 to trade with China using the yuan instead of the dollar.
And then in March, France was all like, “Hey, China, we’ll sell you 65,000 tons of liquefied gas, and you can pay us in yuan!” Brazil even struck a deal with China to trade in yuan. Analysts say that one of the things that weakened the dollar was this fancy term called “quantitative easing.”
It started in 2008 and involved printing loads of money, or as they called it, “helicopter money.”
All that extra cash didn’t boost production. In fact, over the past 15 years, there’s been a whopping 40% increase in dollars floating around, and that’s a major reason why we’re seeing crazy inflation these days.
Along with all of that, Russia is upping its game by trying to settle trade with ASEAN countries using their local currencies. This move comes as Russia faces some Western sanctions over the Ukraine crisis, so they’re trying to find alternatives to the mighty dollar.
But Russia isn’t alone in this de-dollarization trend. Other emerging market economies like China, India, and ASEAN are also jumping on the bandwagon. They’re tired of the chaos caused by the global payment system and Western sanctions.
So, it seems like everyone is looking for ways to make trade smoother and more independent. But this trend is not just good news for Russia but also China. Analysts say it helps China’s foreign trade and the internationalization of their currency, the yuan.
And get this: Russian Foreign Minister Sergey Lavrov recently attended the ASEAN Regional Forum and proposed using national currencies for trade settlements between Russia and ASEAN countries.
Lavrov is all about practical cooperation and believes this move will strengthen their ties. According to Song Kui, the president of the Contemporary China-Russia Regional Economy Research Institute, using the yuan and ruble has already been working wonders for China-Russia trade, especially in the energy sector.
Their bilateral trade has skyrocketed! In fact, in the first half of this year, trade between China and Russia surged by a whopping 50.9 percent. But here’s the thing: the US-led West keeps slapping sanctions on Russia. Yet, despite all that, China and Russia are determined to push their bilateral trade to new heights. They have their sights set on reaching $200 billion by the end of 2023.
More Details In The Video
Leave a Reply