Dedollarization in the world: how some countries did it
In international payments, the dollar is used: so many are used to. The dollar financial market is much stronger than others. However, the aggressive policy of the United States against some countries forced them to look for alternatives. As a result, the world was divided into two groups: those who are satisfied with the dollar and who take systematic steps to abandon the national currency of the United States.
The trade confrontation between Beijing and Washington has benefited both China and the United States. For China, one of the positive effects is the decline in the share of the dollar in international payments. Recall: China – the main buyer of US bonds. Moreover, representatives of the country have repeatedly made statements that US securities are a profitable investment for them. Nevertheless, gradually, the country still gets rid of American bonds. In 2019, the amount of public debt in the hands of the Chinese decreased to a record low value observed in the spring of 2017.
China gets rid of the dollar not so much as a result of trade opposition, as in attempts to make the yuan the world currency. Recall: China’s money is included in the basket of reserve currencies, along with the yen, pound and euro. China also launched on the Shanghai Stock Exchange trading oil futures in RMB. The country is a regular lobbyist of its currency in settlements with other states. Beijing is also increasing its influence on the economies of countries.
Southeast Asia, offering them a swap line for trade partnerships. Aggregate emerging Asian markets represent an economy of 50 trillion dollars (approximately 40% of the global economy).
The economy of India is the sixth in the world. The country is an active importer of oil and industrial goods. A number of historical partners of the country are under US sanctions. Therefore, the country pays for Russian weapons in rubles, and for Iranian oil – in rupees. At the end of 2018, a swap agreement appeared between the United Arab Emirates and India, which implies trade and investment without the use of foreign currencies.
Dedollarization in the world: the Turkish experience
Trade relations between the United States and Turkey show a downward trend from 2016. President Erdogan and now believes that the States are directly involved in the attempt to conduct in his country a “color revolution”. Therefore, the highest state official is negotiating with China, Russia and Ukraine on trade using domestic currencies. Turkey also has plans to use the lira in settlements with Iran. However, the lira was not the most stable monetary unit – its course collapsed after the United States imposed sanctions for the arrest of the American pastor Branson.
The national currency of Iran rial does not hold water. Therefore, in settlements with India for oil, a rupee is used. India is profitable – its currency is returned to the country in the form of investments and large purchases of pharmaceutical products.
