Analysts estimate the US share in world GDP 22%, while the dollar accounts for up to 81% of international payments, writes Asian Fortune. Given this imbalance, the process of getting rid of the dollar will not be easy at all, according to Zhang Xin, a columnist for the publication. However, the main thing is that the process has been launched, and even European countries are participating in it, the publication says. Countries challenging US hegemony, such as China, Russia and Iran, are trying to de-dollarize, European banks and energy companies are also moving in this direction. But the process of moving away from the dollar will take a long time, since, with the exception of bilateral trade between countries, in international commerce when pricing and mutual settlements, the use of other currencies will lead to additional costs and problems. 
The share of US GDP in the world is 22%, the share of the dollar in international payments is 81%, source - Bloomberg. The dollar, like American military power, is the cornerstone of post-war US hegemony. Conversations and rumors about dedollarization have been ongoing since the 70s of the last century. In 2014, major players in the Eurasian region, represented by individual states and corporations, took this process to a new level. Now there is a group of countries with real opportunities in order to finally abandon the use of American currency. Among these countries, Russia is the most willing to resort to such rhetoric. The ongoing escalation of events in Ukraine since the end of 2013 has led to Russia being subject to serious economic and financial sanctions from the West. This forced her to accelerate the creation of an alternative to the US-centric economic system, although at the moment it is not yet capable of completely replacing it. This spring Russian government held a “meeting on dedollarization” under the leadership of First Deputy Prime Minister Igor Shuvalov. There, the Ministry of Finance announced plans to increase the share of ruble contracts and gradually phase out the use of the dollar. In May, the so-called “deal of the century” was signed at the Shanghai summit, under which China will purchase natural gas worth approximately $400 billion from Russia over the next 30 years. At the end of June, Gazprom announced its readiness to use the ruble or yuan for this. The most significant progress in the field of de-dollarization is that from the end of August, a subsidiary oil company of Gazprom will accept payment in rubles for the export of 80,000 tons of oil from the Arctic field to Europe, as well as an agreement to use the yuan in payments for oil supplies through the Eastern Pipeline. Siberia - Pacific Ocean". In August, Vladimir Putin, during his visit to Crimea, said that “the petrodollar system should remain a thing of the past,” and also noted in this regard that “we are currently discussing with several countries the possibility of using national currencies in mutual settlements.” The “multiple countries” here do not only mean China—in August, Russia and Iran signed a historic deal to purchase $20 billion worth of oil in rubles, circumventing the Western embargo. During a meeting between the first vice-premiers of China and Russia, Igor Shuvalov and Zhang Gaoli announced that the governments of the two countries had agreed to increase the shares of the ruble and yuan in trade. China, in addition to the bilateral energy agreement with Russia, attaches great importance to agreements on the use of local currencies in trade and finance. From 2008 to 2013, currency swap agreements worth 2.6 trillion yuan ($424.6 billion) were signed with 24 countries. China and Russia also reduced the share of US Treasuries in their gold and foreign exchange reserves last year, while Russia sold almost a third of its US government securities in March alone. The eurozone is also committed to de-dollarization Beyond the natural Sino-Russian alliance, an even more pronounced movement away from the dollar will gain momentum within the European world. At the end of June last year, the US Department of Justice fined the French bank BNP Paribas $9 billion, which exceeded the bank's entire profit for 2013 by $900 million. The US leadership accused the bank of dealing with funds from Sudan, Iran, Cuba and other countries that were subject to sanctions. economic sanctions. Even more humiliating for BNP Paribas, 13 of its senior employees will be forced to resign and will likely be permanently banned from banking. In July at the headquarters European Union A meeting was held at which the finance ministers of the participating countries launched the first dedollarization initiative. If such a desire is quite natural for Russian energy companies, then such an attitude on the part of the largest oil companies Europe looks even more revealing. The head of the second largest oil producer, the French company Total, said after the meeting that if oil prices are denominated in dollars, this does not mean that settlements for it should also be made in dollars. Due to the dollar's status as an international currency, much of its use outside of America occurs in transactions that do not directly relate to it, causing the US dollar to be overvalued compared to other currencies. For this reason, consumers within the US receive imported goods at reduced prices. The high demand for dollars in the world also allows the US government to refinance its debts at very low prices. interest rates. Therefore, de-dollarization will undoubtedly be a direct challenge to the economic hegemony of the United States and the overall high standard of living of its citizens, and the political and business circles of America will oppose this process. At the same time, even taking into account the countries that have challenged the United States, de-dollarization will be an extremely long and bitter confrontation. The currencies of other countries can only partially replace the dollar for determining prices and settlements between trading partners. Moreover, such a replacement is possible only in bilateral relations between countries. In this sense, the yuan is still not a fully convertible currency and lacks broader international application as a tool for the formation of reserves. Thus, over time, dedollarization will represent a multitude of national currencies increasingly used in international financial system. At the same time, major currencies will be heavily dependent on swap agreements, similar to those that China is now actively using. Such a pricing and settlement model will be fraught with additional costs. The issue of distributing these costs across currencies and countries will make de-dollarization a long process and another major political challenge for the Chinese leadership. Bank of America: " currency wars» will lead to economic growth The most significant fluctuation in the rates of major currencies in 20 years occurred from mid-January to early February. This is stated in a study by BofA Merrill Lynch. The fall in rates is associated with “currency wars,” notes report author David Wu, a BofA specialist in foreign exchange markets. According to him, until the current period, volatility exchange rates increased sharply only during the Asian financial crisis of 1997-1998 and at the height of the global crisis in 2008. By “currency wars,” the expert means attempts by countries to depreciate their national currencies in order to help the economy. The United States and China will be the first to suffer from such a “war,” Wu believes. A danger to the US economy is the fact that 40% of revenues from local companies are received abroad. In addition, cheaper foreign goods become more attractive to buyers. The Chinese yuan has also risen in price, however, according to the expert, Beijing is unlikely to begin an artificial devaluation due to the threat of capital outflow and loans from Chinese companies in foreign currency. The European Union made its move in the “currency war” at the end of January. central bank, who announced his intention to “print” over €1 trillion. After the information was made public, the euro fell in price against the dollar to its lowest level since 2003. The National Bank of Ukraine also refused to support the hryvnia, which reached a historical low against the dollar. Previously, the Swiss National Bank lifted the ceiling exchange rate franc. The unexpected actions of this country caused a storm on foreign exchange market: Many companies have declared financial insolvency. Denmark may come to the same decision. “In a world where sources for further growth are almost exhausted and policy instruments are in short supply, currency wars will persist for a long time,” the study notes.
According to Bank of America forecasts, “currency wars” should lead to economic growth.
Deputy Prime Minister Yuri Borisov said that India will pay for the supply of S-400 Triumph anti-missile systems in rubles. China is not far behind: according to VEB head Igor Shuvalov, the agreement on mutual settlements in national currencies may be signed before the end of this year. How will Russia benefit from dedollarization? foreign trade and who else is ready to join payments in national currencies - in the RIA Novosti material.
Red light to green
The contract for the supply of S-400 systems to India was signed on October 5 this year during Vladimir Putin’s visit to Delhi. Experts estimate it at five billion dollars. At the Bank of Russia exchange rate, this is 331 billion rubles.
The biggest and most obvious benefit for both countries when trading in their national currencies is that there are no major fluctuations in conversion.
So, on January 1 of this year, the ruble was worth 0.89 Indian rupees, and 10 months later - 0.88 rupees. The maximum rate during this year is 0.98 rupees per ruble, the minimum is 0.85 rupees. It means that the volatility corridor amounted to 0.13 rubles for the entire year.
For comparison: on January 1, the dollar cost 57.04 rubles, and on November 1 - already 65.6 rubles. The maximum value this year is 69.9 rubles, the minimum is 55.6 rubles. The volatility corridor is 14.3 rubles. The difference in this indicator between the ruble/dollar and ruble/rupee pairs is fabulous - 11,000%.
Another equally important problem in payments through the American dollar is the high probability of sanctions, which Washington is distributing left and right this year.
In April, Indian media reported that financial structures Delhi has frozen about two billion dollars allocated to pay for critical projects, including the repair of the nuclear submarine Chakra (Project 971 Shchuka-B) leased from Russia.
The reason is that the White House included Rosoboronexport on the sanctions list. For financial institutions this actually means a ban on any payments in US currency.
But, as practice shows, the world is no longer taking Donald Trump’s threats seriously. India chose to maintain relations with its most reliable partner in the field of military-technical cooperation and arms supplies - Russia.
According to the Stockholm Peace Research Institute (SIPRI), From 2007 to 2017, Russia supplied $24.5 billion worth of weapons to India. USA - only 3.1 billion.
And Russia’s trade with India is not only about arms supplies, the volume of which in 2017 amounted to about $1.9 billion (against the background of a total trade turnover of $9.1 billion). According to Borisov, it is also possible to pay for civilian products in national currencies.
“Today, the share of settlements in rubles for exports is 20%, for imports - about 21%,” noted the Russian Deputy Prime Minister. - This is a good indicator, but, nevertheless, we will increase settlements in national currencies as a means to solve the problem of non-payments. This also applies to contracts on military-technical cooperation.”
It’s not just the Amur that unites
Another excellent news for Moscow on the same topic came in early October from the head of Vnesheconombank (VEB) Igor Shuvalov. The top manager said that Russia and China have their own channels for interaction, adding that in the current situation Beijing is also interested in using them.
“We understand how this scheme should work, it should be described in the agreement. The Chinese side is no less, and perhaps even more interested, since this was stated yesterday by the Chairman of the People's Republic of China, in having such an agreement signed in as soon as possible“, Shuvalov informed journalists about the results of intergovernmental negotiations.
The banker clarified that bilateral consultations will be held in the coming weeks, during which it will be necessary to finally decide how interaction between financial institutions both countries and who will take on the role of authorized operator in Moscow and Beijing.
It is worth noting that the dynamics of the ruble and yuan exchange rates this year were more similar to the ratio of the ruble to the Indian rupee than the ruble to the dollar. On January 1 of this year, the yuan at the Central Bank exchange rate was worth 8.74 rubles, and on November 1 - 9.4 rubles. The highest rate of the Chinese currency was recorded at 10.1 rubles, and the lowest - 8.72 rubles.
Thus, the volatility corridor between the ruble and the yuan was only 1.38 rubles versus 14.3 between the ruble and the dollar. As is the case in India, for businesses this means reduced risk of foreign exchange losses.
The volume of mutual trade is also pushing for the abolition of payments in dollars between Moscow and Beijing. Last year, the turnover between Russia and the United States amounted to $23.6 billion, and between Russia and China - $84.9 billion (a difference of almost 360%).
Moscow, Beijing and Delhi are showing the world how to get rid of dollar dependence by their example.. It is noteworthy that all three countries are major developing economies, while the US is a developed economy. This means that mutual settlements in national currencies open up prospects for others developing economies and are able to finally save world trade from dollar hegemony.
MOSCOW, November 8 – RIA Novosti, Alexander Lesnykh. Deputy Prime Minister Yuri Borisov said that India will pay for the supply of S-400 Triumph anti-missile systems in rubles. China is not far behind: according to VEB head Igor Shuvalov, an agreement on mutual settlements in national currencies can be signed before the end of this year. What benefits will Russia receive from the de-dollarization of foreign trade and who else is ready to join payments in national currencies - in the RIA Novosti material.
Red light to green
The biggest and most obvious benefit for both countries when trading in their national currencies is that there are no major fluctuations in conversion.
So, on January 1 of this year, the ruble was worth 0.89 Indian rupees, and 10 months later - 0.88 rupees. The maximum rate during this year is 0.98 rupees per ruble, the minimum is 0.85 rupees. This means that the volatility corridor was 0.13 rubles for the entire year.
For comparison: on January 1, the dollar cost 57.04 rubles, and on November 1 - already 65.6 rubles. The maximum value this year is 69.9 rubles, the minimum is 55.6 rubles. The volatility corridor is 14.3 rubles. The difference in this indicator between the ruble/dollar and ruble/rupee pairs is fabulous - 11,000%.
Another equally important problem in payments through the American dollar is the high probability of sanctions, which Washington is distributing left and right this year.
In April, Indian media reported that Delhi's financial structures froze about two billion dollars allocated for payment for critical projects, including the repair of the Chakra nuclear submarine leased from Russia (Project 971 Shchuka-B).
The reason is that the White House included Rosoboronexport on the sanctions list. For financial institutions, this actually means a ban on any settlements in US currency.
But, as practice shows, the world is no longer taking Donald Trump’s threats seriously. India chose to maintain relations with its most reliable partner in the field of military-technical cooperation and arms supplies—Russia.
According to the Stockholm Peace Research Institute (SIPRI), Russia supplied $24.5 billion worth of weapons to India from 2007 to 2017. USA - only 3.1 billion.
And Russia’s trade with India is not only about arms supplies, the volume of which in 2017 amounted to about $1.9 billion (against the background of a total trade turnover of $9.1 billion). According to Borisov, it is also possible to pay for civilian products in national currencies.
“Today, the share of settlements in rubles for exports is 20%, for imports - about 21%,” noted the Russian Deputy Prime Minister. “This is a good indicator, but, nevertheless, we will increase settlements in national currencies as a means of solving the problem of non-payments. This also applies to contracts on military-technical cooperation."
It’s not just the Amur that unites
Another excellent news for Moscow on the same topic came in early October from the head of Vnesheconombank (VEB) Igor Shuvalov. The top manager said that Russia and China have their own channels for interaction, adding that in the current situation Beijing is also interested in using them.
“We understand how this scheme should work, it should be described in the agreement. The Chinese side is no less, and perhaps more interested, since this was stated yesterday by the Chairman of the PRC, that such an agreement be signed as soon as possible.” , Shuvalov informed journalists about the results of intergovernmental negotiations.
The banker clarified that bilateral consultations will be held in the coming weeks, during which it will be necessary to finally decide how interaction will take place between financial institutions of both countries and who will take on the role of an authorized operator in Moscow and Beijing.
If we were to identify the factors fueling American imperialism and the quest for global hegemony, the US dollar would feature prominently on the list. But his position has now noticeably weakened due to the new scheme - gas-yuan-gold, proposed by Russia and China. Petroyuan and gold have become the main “tools” in the fight against.
The reason why the dollar plays so much important role in the global economy, consists of the following three main factors: petrodollar; dollar as the world reserve currency; and Nixon's decision in 1971 to end the conversion of the dollar into gold. It is not difficult to guess that the petrodollar greatly influenced the set of currencies in the SDR (international means of payment intended for use for strictly defined purposes by member countries of the International Monetary Fund), becoming the world's reserve currency and paving the way for serious consequences in the global economy. Globalresearch.ca writes about this.
Thus, the US Federal Reserve was able to begin printing dollars with virtually no restrictions, thus supporting huge sectors of private and state enterprises(for example, in the oil industry). This laid the foundation for a global economic system in the form financial instruments and securities instead of real tangible goods such as gold. By doing this for its own benefit, the US has created the conditions for a new financial bubble that could destroy the entire world economy when it bursts.
A destabilizing factor for the global economy was also Washington’s ability to accumulate huge volumes of government debt without caring about the consequences or even the possible mistrust international markets to the dollar. Countries simply needed dollars to trade, and they bought securities US government to diversify its financial assets.
The decisive factor that changed the perception of the situation for countries such as China and Russia was financial crisis 2008, as well as growing US aggression after the events in Yugoslavia in 1999. The war and America's continued presence in Afghanistan have underscored Washington's intentions to encircle China, Russia and Iran to prevent any Eurasian integration. Naturally than more than a dollar used throughout the world, the more Washington could spend on its army and military campaigns. Color revolutions, hybrid warfare, economic terrorism and attempts to destabilize different countries had a disastrous effect on Washington's military authority. Many countries now see the United States as a big country that can't get what it wants, can't achieve agreed upon common goals, and doesn't even have the ability to control countries like Iraq and Afghanistan despite its military superiority.
IN last years It became clear to many of Washington's adversaries that the only way to contain the consequences of the collapse of the American empire was to gradually abandon the dollar. This will limit the amount of Washington's military spending and create the necessary alternative instruments in the financial and economic sphere that will help eliminate Washington's dominance. The abandonment of the dollar is an important part of the Russian-Chinese-Iranian strategy for unifying Eurasia.
The US hurt itself by excluding Iran from SWIFT systems(giving way to a Chinese alternative to CIPS) and imposing sanctions on Russia, Iran and Venezuela. These actions only accelerated the process of Eurasian integration, as well as the process of extraction and acquisition by China and Russia physical gold, given that the US Federal Reserve is rumored to have no more gold left. It is no secret that Beijing and Moscow are seeking to establish a gold-backed currency in case the dollar collapses. This is pushing some countries to begin operating in a non-dollar environment and through alternative financial systems.
How this happens can be seen in the example Saudi Arabia, which is a key element of the petrodollar system. Beijing has put intense pressure on Riyadh to accept yuan instead of dollars for oil sales, as other countries such as Russia do.
However, Riyadh is obliged to obey the United States, an ally that does not care about the country's position in the region (Iran is now becoming increasingly influential in Iraq, Syria and Lebanon) and which, moreover, is a competitor in the oil market. At the same time, China remains largest client Riyadh, and given agreements with Nigeria and Russia, Beijing can safely stop buying oil from Saudi Arabia if Riyadh continues to insist on sales in dollars.
For China, Iran and Russia, as well as for some other countries, de-dollarization is an urgent issue. The number of countries that are starting to see the benefits of a decentralized system is gradually increasing. Iran and India, as well as Iran and Russia, are already trading hydrocarbons among themselves in exchange for raw materials, thereby bypassing American sanctions. The same way economic power China allowed the country to open to Iran line of credit in the amount of 10 billion euros, bypassing recent sanctions. Even North Korea appears to be using cryptocurrency to buy oil from China and circumvent US sanctions. Venezuela (which has the world's largest oil reserves) just took a historic step away from trading oil in dollars and announced that it will begin receiving money in a basket of currencies without the US dollar. Beijing will buy gas and oil from Russia and pay for them in yuan, and Moscow will be able to instantly convert the yuan into gold thanks to the Shanghai International Energy Exchange. The new gas-yuan-gold scheme speaks of revolutionary economic changes due to the gradual abandonment of dollar trading.
Josef Janning, Head of ECFR Berlin
The European Commission's plans to strengthen the role of the euro in international trade driven by recognition of the structural dependence of European trade on the US economy, on the dollar as a global currency, and on dollar transactions for key goods. US extraterritorial legislation and sanctions policy only increase Europe's dependence. Be that as it may, this approach in no way implies “abandonment of the dollar” or a complete replacement of the American currency with the euro.
Eurozone countries are unwilling and currently unable to deal with the political implications of such a substitution strategy and are wary of facing the financial implications for the euro as a global reserve currency.
At best, a strengthening of the euro could lead to the replacement of the US dollar with a basket of leading world currencies - the yuan, the yen, and the euro. The EU must ensure that major energy contracts are concluded on a euro basis, using a basket of currencies accordingly. Likewise, all key contracts for commodities, from soybeans to aircraft, must be paid in euros. Such measures will reduce commitment to the dollar and the currency consequences of US sanctions, although they will not reduce the interest of European companies in the US market.
It is clear that even with the inclusion of the Chinese market, exporting to the US or manufacturing in the US is more important for many large European companies than for any other export market outside the EU. After all, the US and EU are each other's most important export and investment destinations - and European policymakers are unlikely to want to undermine their own interests.
For Russia, “de-dollarization” should strengthen relations with European countries in the energy sector – in particular with Germany – but it does not provide significant strategic advantage beyond this.
With a GDP equal to Spain, Russian market too small and too static to balance transatlantic business ties. Russian geopolitics continues to generate controversy on both sides of the Atlantic (as if there weren't enough already), irritating European politicians, undermining EU integration and intimidating neighbors. Thus, the potential for partnership with Europe that Russia can exploit will remain very limited.
China, the only competitor to the American economy and geopolitics in the eyes of decision makers in Washington, can really change the situation. China has been a central focus of US strategy since the turn of the century, a shift that only emerged in response to the fight against terrorism and the wars in the Middle East after 9/11. The Trump administration has brought China back into the spotlight.
As the rivalry intensifies, America's foreign relations are increasingly viewed through the lens of their usefulness to US policy to contain China. Beijing seems to be gradually adopting America's experience. This could quickly raise trade wars further high level, which will have a direct impact on both Europe and Russia, not to mention other regions. Both sides will expect their partners to support them.
Political and economic consequences Such a scenario has much more destructive potential than the US withdrawal from the Iran agreement. And strengthening the euro as a trading currency is unlikely to change the situation.
