Russia and China have made an intergovernmental agreement on payments in national currencies. Europe is launching the INSTEX mechanism, which allows to trade with Iran, bypassing Washington’s sanctions and without a dollar.
Exactly a year ago, World Bank economists claimed that global dedollarization process had been launched and could not be stopped. Analysts then noted that Russia could exclude the dollar from calculations, primarily with the largest trading partner China.
Moscow and Beijing decided to switch to national currencies in December 2014. Since then, Russian-Chinese agreements on direct trade in rubles without the participation of US, UK and EU banks have come into effect. However, the progress has been modest: over the past year, the share of the euro in payments has doubled, the dollar has decreased by less than two percent.
A ruble is made up for about ten percent. However, next years, this figure will increase fivefold. In early June, First Deputy Prime Minister and Minister of Finance of Russia Anton Siluanov, and Chairman of the People’s Bank of China and Ghana have signed an agreement on the creation of a new payment system, which will become “the gateway between the Russian and Chinese counterparts of SWIFT.”
A new payment system in national currencies is supposed to work by the end of a current year and seize primarily the largest Russian oil and gas companies, as well as agricultural producers.
Moscow and Beijing are in a hurry because of the threat of increased economic sanctions from Washington.
As about 42 percent of transactions in SWIFT are carried in dollars, this is a powerful weapon of Washington. Disconnection from the system threatens the Russian economy with serious problems, ranging from capital flight to devaluation of ruble and the growth of lending rates.
Natalia Veselnitskaya – official website