BRICS and 20 Countries ditch US dollar: Is that Peak of De-dollarization?
Summary
TLDRThe video discusses the global trend of 'dollarization', where nations are moving away from the US dollar in trade transactions to enhance economic stability and reduce dependence on a single currency. It highlights the efforts of BRICS nations, particularly China and Russia, in promoting digital currencies and bilateral currency swaps. The script also covers the strategies of other countries like Saudi Arabia, UAE, and Egypt in diversifying their currency use and reducing reliance on the dollar, indicating a shift towards more localized and digital financial transactions for global trade.
Takeaways
- 🌍 Nations and regional alliances are increasingly moving away from the US dollar for trade transactions, a process termed de-dollarization.
- 💰 This trend aims to decrease dependence on a single currency, enhancing economic stability by using a variety of local currencies.
- 🔍 By prioritizing their own currencies, countries aim to mitigate geopolitical risks and bolster their domestic economies.
- 📉 The ongoing shift is transforming global trade and financial systems, potentially reducing the global dominance of the US dollar.
- 💳 BRICS nations, including China, Russia, India, Brazil, and South Africa, are leading the de-dollarization efforts with a strong focus on developing digital currencies and Central Bank Digital Currencies (CBDCs).
- 🇨🇳 China has significantly shifted from the US dollar to the yuan in cross-border payments, with the yuan accounting for 52.9% of China's international settlements by March 2024.
- 🇷🇺 Russia has intensified its efforts to reduce reliance on the US dollar, increasing the use of the Chinese yuan and conducting trade with India using rupees.
- 🇮🇳 India is promoting the use of the Indian rupee in international trade, entering into agreements with several countries to settle trade transactions in local currencies.
- 🇿🇦 South Africa supports BRICS's collective aim to reduce reliance on the US dollar in international trade, participating in various de-dollarization initiatives.
- 🇧🇷 Brazil advocates for using local currencies for trade and investment within the BRICS block, pushing for greater use of local currencies in international trade, particularly with China and Argentina.
- 🏦 Saudi Arabia, the UAE, Iran, and other countries are also exploring alternatives to the US dollar for trade transactions, including oil sales and other significant trade deals.
- 🌐 This collective global movement towards de-dollarization reflects a strategic effort to enhance financial independence and stability amidst geopolitical and economic fluctuations.
Q & A
What is the term used to describe the trend of nations moving away from using the US dollar for trade transactions?
-The term used is 'dollarization'.
Why are countries prioritizing their own currencies in international transactions?
-Countries aim to mitigate geopolitical risks, bolster their domestic economies, and enhance economic stability by decreasing dependence on a single currency.
What does the BRICS group focus on developing as part of their dollarization efforts?
-The BRICS group focuses on developing digital currencies and Central Bank Digital Currencies (CBDCs).
Which BRICS nation has made significant progress with its digital currency?
-China has made significant progress with its digital currency, leading the way in CBDC innovation and implementation.
What was China's strategy regarding the US dollar in international settlements by March 2024?
-By March 2024, the UN (Yuan) accounted for 52.9% of China's international settlements, surpassing the US dollar at 42.8%.
How has Russia responded to Western sanctions by adjusting its currency strategy?
-Russia has intensified efforts to reduce reliance on the US dollar, particularly by increasing the use of the Chinese Yuan and settling over 80% of its trade with China in Rubles and Yuan.
What is India's approach to reducing reliance on the US dollar?
-India has been working towards enhancing the global role of the Indian Rupee (INR) and fortifying economic sovereignty by settling trade transactions in local currencies and promoting the use of currency swaps.
What significant move did South Africa make to reduce reliance on the US dollar in international trade?
-South Africa completed a $265 million oil deal with Russia that did not use the US dollar, reflecting a broader strategy to mitigate the impact of US sanctions.
What has been Brazil's strategy to reduce reliance on the US dollar within the BRICS block?
-Brazil has been pushing for greater use of local currencies in international trade, particularly with China and Argentina, and has implemented bilateral currency swap agreements.
Which country has shown interest in reducing reliance on the US dollar in its trade with China?
-Japan has shown interest in reducing its reliance on the US dollar, particularly in its trade with China, by promoting the direct exchange of Yen and Yuan.
How is the UAE engaging in dollarization efforts?
-The UAE is engaging in dollarization efforts by strengthening its financial ties with China, signing agreements to settle trade payments in Yuan, and executing a historic transaction involving the Yuan through the Shanghai Petroleum and Natural Gas Exchange.
Outlines
🌐 De-Dollarization Trends in Global Trade
The script discusses the increasing trend of nations and regional alliances moving away from the US dollar in trade transactions, termed 'de-dollarization.' This shift aims to reduce reliance on a single currency, enhancing economic stability through the use of local currencies. The BRICS Plus group, including China, Russia, and India, is highlighted for its focus on digital currencies and Central Bank Digital Currencies (CBDCs) to diminish reliance on the US dollar. China's progress in this area is significant, with the digital yuan leading in CBDC innovation. Other nations like Russia and India have initiated pilot projects for their digital currencies, while Brazil and South Africa are exploring CBDC adoption. The collective initiative among BRICS nations is a strategic move towards financial independence and modernizing cross-border transactions.
📈 Economic Strategies for De-Dollarization
This paragraph delves into the economic strategies of various countries within BRICS Plus to reduce their dependency on the US dollar. China has made remarkable progress by shifting to the yuan in cross-border payments, surpassing the dollar's share. Russia has intensified efforts to reduce reliance on the US dollar, especially after Western sanctions, by increasing the use of the yuan and rubles in trade with China. India is working to enhance the global role of the Indian rupee (INR) and has made agreements with countries like Russia and the UAE for local currency trade. South Africa, while less proactive, supports the collective BRICS aim to reduce reliance on the US dollar. Brazil, under President Lula, advocates for greater use of local currencies in international trade and has implemented bilateral currency swap agreements.
🌍 Broadening the Scope of De-Dollarization
The script expands the discussion on de-dollarization to include countries beyond the BRICS Plus group. Saudi Arabia, traditionally tied to the petrodollar system, is exploring alternatives such as the Euro and the Saudi Rial for oil transactions. The UAE is strengthening financial ties with China, settling trade payments in yuan. Iran, driven by the need to bypass US sanctions, conducts significant trade in yuan. Other countries like Egypt, Ethiopia, Japan, Turkey, Nigeria, Indonesia, Kuwait, Malaysia, Thailand, Kenya, Zambia, and Qatar are also engaging in de-dollarization efforts, reflecting a global trend towards diversifying currency use and enhancing financial cooperation with China.
💼 Global Economic Shifts and De-Dollarization
The final paragraph examines the impact of de-dollarization on the global economy, with a focus on countries like Germany, Britain, Canada, Sweden, Argentina, Bangladesh, Venezuela, Oman, Bahrain, Singapore, and others. These nations are increasingly using the yuan for trade settlements and investments, aiming to diversify currency use and reduce reliance on the US dollar. This strategic shift is driven by geopolitical and economic factors and is supported by agreements and infrastructure development. The move towards de-dollarization represents a significant change in global financial dynamics, reflecting a broader trend towards economic cooperation and stability.
Mindmap
Keywords
💡Dollarization
💡Geopolitical Risks
💡Digital Currencies
💡BRICS
💡Currency Swap Agreements
💡Economic Stability
💡Sanctions
💡Foreign Exchange Reserves
💡New Development Bank (NDB)
💡Panda Bonds
💡Diversification
Highlights
Nations and regional alliances are increasingly moving away from the US dollar for trade transactions, a process termed 'dollarization'.
Dollarization aims to decrease dependence on a single currency to enhance economic stability by employing various local currencies.
BRICS nations are focusing on developing digital currencies and Central Bank Digital Currencies (CBDCs) as part of their dollarization efforts.
China has made significant progress with its digital yuan, leading in CBDC innovation and implementation.
Russia and India have launched pilot projects for their digital currencies, while Brazil and South Africa are investigating CBDC adoption.
China has significantly shifted from the US dollar to the yuan in cross-border payments by March 2024.
Russia has intensified efforts to reduce reliance on the US dollar, especially after Western sanctions due to its actions in Ukraine.
India is working towards reducing reliance on the US dollar to enhance the global role of the Indian rupee (INR).
South Africa supports BRICS's collective aim to reduce reliance on the US dollar in international trade.
Brazil is engaging in dollarization efforts within the BRICS block, advocating for the use of local currencies for trade and investment.
Saudi Arabia has been exploring alternatives to the US dollar for its oil transactions, including the Euro and the Saudi Rial.
The UAE is strengthening its financial ties with China by settling trade payments in yuan.
Iran conducts a significant portion of its trade with China in yuan, mitigating the impact of US sanctions.
Egypt is reducing reliance on the US dollar by issuing yuan-denominated bonds sold in the Chinese market.
Dollarization is not confined to BRICS nations; countries across Asia, Europe, and North America have embraced this movement.
Germany has significantly increased the use of the yuan in financial transactions to diversify and strengthen economic ties with China.
The move towards dollarization is driven by geopolitical and economic factors and is supported by strategic agreements and infrastructure development.
Transcripts
Nations and Regional alliances are
increasingly moving away from the US
dollar for their trade transactions a
process termed
dollarization this trend seeks to
decrease dependence on a single currency
thereby enhancing economic stability by
employing a variety of local currencies
by prioritizing their own currencies
countries aim to mitigate geopolitical
risks and bolster their domestic
economies
this ongoing shift is transforming
global trade and financial systems
potentially reducing the global
dominance of the US
dollar in this video we examine the
recent Trend among various Nations to
decrease their dependency on the US
dollar for international transactions we
investigate the reasons driving these
decisions and offer insights into their
economic strategies
brics Plus's leader of DD
dollarization within the brics group and
its expanding Network there is a strong
focus on developing digital currencies
and Central Bank digital currencies or
cbdcs as part of their D dollarization
efforts China has made significant
progress with its digital un leading the
way in cbdc Innovation and
implementation Russia and IND India have
also launched pilot projects for their
digital currencies while Brazil and
South Africa are actively investigating
cbdc
adoption Russia and India have also
launched pilot projects for their
digital currencies while Brazil and
South Africa are actively investigating
cbdc
adoption this Collective initiative
among brics nations highlights a
strategic move to diminish Reliance on
the US dollar enhance Financial
Independence and modernize crossboard
transactions through digital Financial
tools let's explore the dollarization
progress of each bricks plus
member China has significantly shifted
from the US dollar to the UN in crossb
payments by March 2024 the UN accounted
for 52.9% of China's International
settlements surpassing the dollar at
42.8% this change is remarkable
considering that in 2010 less than 1% of
such payments were made in when key
initiatives in China's dollarization
strategy include bilateral currency swap
agreements by early 2024 China had
signed currency swap deals with over 40
countries totaling more than 4 trillion
w $582.92
and Argentina integrating un usage into
its belt and Road initiative this
initiative aims to expand economic
influence by financing infrastructure
projects and encouraging trade in un
furthermore China has Diversified its
reserves reducing Holdings of US
Treasury bonds while increasing gold
reserves in the first quarter of 2024
China sold a record 53.3 billion worth
of us bonds part of its strategy to
decrease dependence on dollar assets
Russia has significantly intensified its
efforts to reduce Reliance on the US
dollar particularly following the
imposition of Western sanctions due to
its actions in Ukraine President
Vladimir Putin has described the
currencies of unfriendly States as toxic
and noted that Russia has HED its use of
such currencies in the last year a key
component of Russia's dollarization
strategy involves increasing the use of
the Chinese yen over 80% of Russia's
trade with China is now settled in
Rubles and un a significant shift from
two years ago when it was around
30% Russia has also boosted the un's
share in its National reserves and the
rubal UN trade has increased
dramatically making the UN a crucial
part of Russia's foreign trade
additionally Russia has focused on
enhancing economic ties with other brics
nations for instance it conducts
transactions with India using rupees
which helps mitigate the economic impact
of sanctions and increases Financial
stability by relying on on local
currencies Russia's national wealth fund
has increased the permissible share of
Wen reserves to 60% and Ruble trade has
surged significantly since
2022 despite these efforts challenges
remain such as the dependency on China's
economic policies and the inherent
vulnerabilities of such a
partnership let's take a quick pause
could you do us a favor if you enjoy our
content please hit the like button to
help even more leave your thoughtss and
feedback in the comments your engagement
helps us grow thank
you India has been actively working
towards reducing its Reliance on the US
dollar aiming to enhance the global role
of the Indian rupe INR and fortify
economic sovereignty this strategic
shift is part of a broader movement
among emerging economies to mitigate
risks associated with the Dollar's
dominance in global trade and finance
India has entered into agreements with
several countries to settle trade
transactions in local currencies notably
India has arrangements with Russia and
the UAE to use rupees for bilateral
trade these agreements aim to reduce
transaction costs and enhance economic
cooperation India has been promoting the
use of currency swaps to facilitate
trade with countries facing us sanctions
this includes agreements with Russia
allowing transactions in Rubles and
rupees thereby bypassing the dollar The
Reserve Bank of India RBI has allowed
local importers to open special overseas
bank accounts for rupee payments this
initiative is part of India's broader
strategy to internationalize the rupee
and reduce dependence on the
Dollar South Africa as a member of
bricks has participated in dollarization
efforts although it has not been as
proactive as other bricks members like
China and Russia the country's approach
reflects a strategic alignment with
broader brics initiatives rather than
leading its own dollarization agenda
South Africa supports brics's Collective
aim to reduce Reliance on the US dollar
in international trade this is evident
in collaborative efforts within brics to
promote the use of local currencies
among member countries for example South
Africa has increased the use of the
Chinese UN in its foreign exchange
reserves and bilateral trade with China
in a significant move South Africa and
Russia completed a $265 million oil deal
that did not use the US dollar this
agreement is part of a broader strategy
to mitigate the impact of us sanctions
on Russia and to strengthen economic
ties within bricks through local
currency transactions South Africa has
also been involved in setting up
Financial infrastructures that
facilitate dollarization such as
participating in the new development
Bank NDB which aims to support projects
in member countries using local
currencies South Africa has incorporated
the Chinese Ren mby into its foreign
exchange reserves aiming to diversify
currency risk this inclusion supports a
gradual shift away from the US dollar
promoting Financial stability amidst
global economic
fluctuations Brazil has been actively
engaging in dollarization efforts as
part of its economic strategy within the
brics block president Louise inao Lula D
Silva has been a vocal advocate for
reducing Reliance on the US dollar
emphasizing the need for brics countries
to use local currencies for trade and
investment Brazil has pushed for greater
use of local currencies in international
trade particularly with China and
Argentina this initiative aims to
streamline trade processes and reduce
dependency on the US dollar president
Lula has questioned the necessity of
using dollars for trade between brics
nations advocating for direct currency
exchanges instead the establishment of
the NDB has been a Cornerstone in
Brazil's dollarization strategy the bank
provides financing for projects in
member countries using local currencies
thus reducing the Reliance on the dollar
the NDB is seen as a strategic platform
to promote Financial cooperation among
developing countries and enhance
economic stability Brazil has
implemented bilateral currency swap
agreements to facilitate trade using
local currencies these agreements help
mitigate the risks associated with
currency exchange and provide a more
stable economic environment for trade
Partners president Lula has been a
prominent leader in promoting
dollarization within brics he has called
for the creation of a brics currency to
further integrate the economies of
members States and reduce
vulnerabilities associated with the
dollar this proposal is expected to be a
key Topic at upcoming brics
meetings Saudi Arabia has been exploring
alternatives to the US dollar for its
oil transactions in 2023 the Saudi
Finance Minister announced the country's
openness to trading in other currencies
including the Euro and the Saudi Rial
this marked a significant shift from the
traditional Petra dollar system
established in the 19 7s further
solidifying this shift Saudi Arabia and
China signed a currency swap agreement
aimed at expanding the use of local
currencies for trade additionally Saudi
Arabia's growing trade with Russia
including importing record levels of
fuel oil further pushes the need for
non-dollar transactions the UAE has been
actively engaging in dollarization
efforts particularly by strengthening
its Financial ties with China the UAE
has signed agreements to settle trade
payments in un including crucial energy
transactions this move aligns with the
uae's broader strategy to diversify its
currency use and reduced dependency on
the US dollar notably a historic
transaction involving the W was executed
through the shangh high petroleum and
natural gas exchange marking a critical
step in using the UN for major trade
deals Iran has long been a proponent of
dollarization largely driven by the need
to bypass us sanctions Iran conducts a
significant portion of its trade with
China in un this includes oil sales
which are frequently settled in un
mitigating the impact of sanctions
Iran's strategic Partnerships within
brics further support its dollarization
efforts aiming to strengthen economic
resilience against geopolitical
pressures Egypt is taking concrete steps
to reduce its Reliance on the US dollar
by issuing Panda bonds which are un
denominated bonds sold in the Chinese
market in October 2023 Egypt issued
panda bonds worth 3.5 billion yuan $479
million these bonds help Egypt secure
financing at a lower cost compared to
dollar denominated debt additionally
Egypt uses the Yuan for some trade
settlements aligning with its strategy
to strengthen economic ties with China
Ethiopia is also moving towards
dollarization by engaging in trade and
financial agreements that favor local
currencies although Ethiopia's economic
impact is smaller compared to other
bricks members it follows the broader
Regional trend of reducing dependency on
the dollar Ethiopia's participation in
the belt and Road initiative BR with
China facilitates greater Financial
cooperation and supports its
dollarization
efforts dollarization is not confined to
the bricks Nations countries across Asia
Europe and North America have also
embraced this movement though their
levels of Engagement vary here are some
of the other countries involved in the
dollarization effort Japan has shown
interest in reducing its Reliance on the
US dollar particularly in its trade with
China the two countries have agreed to
promote the direct exchange of Yen and
un to facilitate trade without the
intermediary use of the US dollar turkey
has been increasingly engaging in trade
agreements that bypass the US dollar the
country has signed currency swap
agreements with several Nations
including China and Qatar to facilitate
trade in local currencies Nigeria has
also begun to explore dollarization
strategies the country has engaged in
discussions with China to increase the
use of the Yuan for bilateral trade
aiming to reduce its dependency on the
dollar Indonesia is increasing the use
of the WAN in trade to bolster trade
relations with China this strategy
supports Indonesia's efforts to
diversify currency use and reduce
Reliance on the dollar reflecting its
approach to Financial Risk Management
Indonesia's main Global exports include
palm oil and coal Kuwait has
incorporated the U into some trade
settlements to diversify currency use
and reduce dollar dependency this
strategic shift enhances Financial
stability and strengthens economic ties
with China reflecting a regional Trend
towards dollarization Kuwait's primary
export is crude oil Malaysia is boosting
un denominated transactions to
strengthen economic ties with China and
diversify currency use this strategy
aims to reduce dollar Reliance and
enhance Financial cooperation with China
reflecting Malaysia's proactive approach
to managing currency risks Malaysia's
main expert ports include electronics
and petroleum products Thailand has
eased rules on un use for trade
promoting local currency use and
financial stability this broader
strategy aims to enhance economic
cooperation with China and reduce
Reliance on the dollar supporting
Thailand's economic diversification
efforts Thailand's primary exports
include electronics and Automobiles
Kenya is considering issuing Panda bonds
and increasing un use to diversify
Financial transactions and reduce dollar
dependency this strategic shift aims to
enhance Financial stability and
strengthen economic ties with China
following a trend of increasing un use
in Africa Kenya's main exports are tea
and Horticultural products Zambia has
established a Yuan clearing bank and
promotes un use and trade to support
local and regional trade this move aims
to enhance Financial stability and
reduce Reliance on the dollar supporting
Zambia's economic objectives Zambia is
known for its copper exports Qatar has
fortified its economic connections with
China through agreements facilitating
trade in UN in 2023 Qatar China trade
reached QR 80 billion around 2.98
billion with China emerging as qatar's
top trading partner significant deals
include long-term LNG Supply agreements
with China National Petroleum
Corporation cnpc and copc enhancing
qatar's economic collaboration with
China and reducing its Reliance on the
US dollar as a major exporter qatar's
primary Global export is liquefied
natural gas Germany has significantly
increased the use of the W in financial
transactions aiming to diversify and
strengthen economic ties with China this
strategic shift is part of Germany's
broader effort to reduce dependence on
the US dollar and enhance Financial
cooperation Germany known for its robust
export sector primarily exports
Automobiles and Machinery Britain has
seen a rise in un transactions as part
of its strategy to boost financial
services and trade this move aligns with
efforts to diversify currency use and
strengthen economic relations with China
showcasing the UK's Financial sector's
adaptability Britain's main Global
exports include financial services and
Machinery Canada has also increased un
payments to enhance financial and trade
relations with China this initiative
supports Canada's strategy to diversify
currency use and reduce dependency on
the dollar reflecting proactive
financial management Canada is widely
recognized for its export of Natural
Resources with crude oil being a
significant part of its Global exports
Sweden has experienced a notable rise in
un denominated transactions aiming to
diversify currency use in financial
dealings this strategic move supports
Financial stability and strengthens
economic ties with China highlighting
Sweden's adaptability Sweden's main
exports include machinery and vehicles
Argentina has adopted the UN for trade
settlements to strengthen Financial
cooperation with China and reduce dollar
dependency this initiative aligns with
Argentina's broader goals of
diversifying currency use and enhancing
economic stability Argentina's primary
Global exports include soybeans and
related products Bangladesh uses the
Yuan for trade settlements as part of
its strategy to boost economic
cooperation with China this move aims to
diversify currency use and reduce
Reliance on the dollar aligning with
Bangladesh's broader economic objectives
Bangladesh is renowned for its textile
and garment exports Venezuela is engaged
in un-based trade agreements to reduce
dependency on the US dollar this
strategy aims to enhance Financial
stability and strengthen economic ties
with China supporting Venezuela's
efforts to navigate economic challenges
Venezuela's primary export is crude oil
Oman has engaged in un trade agreements
as part of its strategy to diversify
currency use this aligns with regional
efforts to enhance Financial stability
and reduced dollar dependency Oman along
with other Gulf cooperation Council GCC
countries has increasingly used the UN
for crossb trade oman's main export is
petroleum Bahrain participates in
un-based trade agreements to diversify
Financial practices and reduce exposure
to Dollar volatility this move supports
bahrain's strategy to enhance Financial
cooperation with China aligning with
regional Trends bahrain's main export is
petroleum products Singapore is active
in un denominated transactions to
facilitate Regional Financial dealings
this broader strategy aims to enhance
economic cooperation with China and
diversify currency use supporting
Singapore's role as a Global Financial
Hub Singapore's main exports include
electronics and
pharmaceuticals the move by these
countries to use the UN for trade
settlements and Investments represents a
significant shift towards
dollarization this trend is driven by
both geopolitical and economic factors
and is bolstered by strategic agreements
and the development of supportive infr
structure that's all for this video
thank you for watching this video we
sincerely appreciate you joining us
today if our content resonated with you
or sparked inspiration please consider
expressing your support by liking it and
subscribing to stay connected with our
community your support holds immense
value for us you can watch another video
of our Channel which is now on the
screen
浏览更多相关视频
BRICS De-dollarization: Is the US Heading for a Clash with BRICS?
The U.S. Dollar was Just REJECTED | Saudi Arabia & BRICS - Dedollarization.
How China is Using BRICS to Change the World Order
Saudi Arabia Just DITCHED The US Dollar.
Saudi Arabia Just Ditched The US Dollar (How This Affects You)
The Fake Petrodollar Story - No, Saudi Arabia Didn’t Ditch the Dollar
5.0 / 5 (0 votes)