China, Russia, and Other Countries Ditching the Dollar in International Trade
by Stephen Lendman
A previous article explained that dollar hegemony as the world’s reserve currency facilitates US global dominance.
A major obstacle to world peace and sovereign independence from US control, dollar tyranny finances Washington’s reckless spending, global militarism, its empire of bases, endless wars, corporate takeovers, as well as speculative excesses that create bubbles and economic crises – at the expense of democratic freedoms and beneficial social change.
In his book “Super Imperialism: The Economic Strategy of Imperial America” and separate writing, Michael Hudson explained that the “dollar glut…pour(s) into the rest of the world.”
Global banks recycle US dollars into “US Treasury bonds to finance the federal US budget deficit” and its global militarism.
As long as world central banks buy US dollars and they dominate international trade, its hegemony is preserved at the expense of world peace, stability, security, and fundamental freedoms that are fast eroding en route to disappearing altogether.
Russia, China, and other nations are increasingly trading in their own currencies, threatening dollar dominance.
In 2018, Venezuela ditched the dollar for international transactions, favoring the euro and a basket of currencies, including the Chinese yuan, Indian rupee, Russian ruble, others and cryptocurrency.
Eight Shanghai Cooperation Organization (SCO) countries decided in principle to conduct bilateral trade and other investments through their national currencies, ditching the US dollar — China, Russia, India, Pakistan, Kyrgyzstan, Tajikistan, Kazakhstan and Uzbekistan.
So did Iran, Iraq, Turkey, and Japan. Will many other countries follow the same pattern?
Nations trading more in their national currencies could prove a game-changer longer-term.
China’s introduction of the petro-yuan was a shot across the bow.
Last year, the South China Morning Post reported that Beijing and Moscow intend to “ditch the US dollar and switch to local currencies in international trade…aiming to cut their dependence on the US” currency.
At the time, finance ministers of both countries were finalizing the basis for bilateral trade in yuan and roubles.
On Monday, Press TV quoted Ayatollah Khamenei advisor/Iran’s Expediency Council member Ali Aqa-Mohammadi on the work in progress 25-year strategic partnership agreement between Tehran and Beijing.
Saying it’s more than an agreement, it’ll ditch the dollar in bilateral trade, protecting their strategic partnership from “third-party intervention” — namely the US, adding:
It’ll counter illegal US sanctions war on both countries, Aqa-Mohammadi stressing:
“The US doesn’t want the sanctions to be relieved. This document upsets the sanctions, and the Iran-China roadmap disarranges many of the US plans.”
“Coordination of Iran and China can take the region out of the US’ hands,” letting both countries enhance their economic development, along with countering hostile Trump regime “maximum pressure” on Iran.
Aqa-Mohammadi believes the longterm Sino/Iran strategic partnership will deliver an “unprecedented (strategic) defeat for the US,” including its aim for regime change.
The bilateral agreement is all about mutual cooperation “in all economic areas,” not just oil and gas alone.
It includes a military component, intelligence sharing, and related activities to counter threats faced by both countries, notably state-terrorism by the US and its imperial partners.
My two Wall Street books are timely reading:
“How Wall Street Fleeces America: Privatized Banking, Government Collusion, and Class War”
“Banker Occupation: Waging Financial War on Humanity”