Dedollarisation ‘almost complete’ as countries move away from US dollar
The share of Russian Ruble and Chinese Yuan settlements in Russia’s total foreign trade has surged to almost 70% as Moscow rapidly shifts away from Western currencies, Economic Development Minister Maksim Reshetnikov said on Friday, (October 20) with the de-dollarization of Russian trade with China now almost complete, the minister told reporters on the sidelines of the Russia-China Energy Business Forum in Beijing.
“Our trade is restructuring. If we look at the country’s trade indicators as a whole, 68% of our trade is carried out in Rubles and Yuan, while 95% our trade with China is settled in Rubles and Yuan. The issue of channels for payments has been solved” Reshetnikov stated.
Recent data from the Russian Economic Development Ministry shows that the Yuan overtook the US dollar in Russia’s import settlements with China in 2022. The RMB Yuan has since been used in Russian trade with Mongolia, Taiwan, the Philippines, Malaysia, the United Arab Emirates, Thailand, Japan, Tajikistan, and Singapore.
Russia’s foreign trade rose by 8.1% in 2022 to US$850.5 billion, the country’s Federal Customs Service said last week. It will likely return to a US$1 trillion economy by the end of 2023. Russia’s trade with China is expected to reach about US$220 billion this year end, or about 20% of its total.
Moscow is continuing to replace previous Western markets with ambitious, and largely successful strategy to develop new markets East and in the Global South.
A few examples include:
The changes reflect Russia’s move away from transactions in the currencies of ‘unfriendly countries’ against the backdrop of Western sanctions. According to Michael G Plummer of the John Hopkins University, the share of the US dollar as an official foreign exchange reserves has fallen from 61.5% in 2012 to 58.4% in 2022. That decrease can be expected to become more intense during 2023 / 2024 as the geopolitical fallout of US sanctions continues.
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