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Yuan exceeds dollar in China's bilateral trade for first time
(asia.nikkei.com)
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this post was submitted on 24 Jul 2023
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I don’t know why we’d be surprised. If you outsource everything to China eventually that will be so much money they get to pick payment methods.
It is because the West sanctions and freezing the money of Russia triggered fears of the same in the Global South, so dedollarisation is happening. Countries are looking for alternatives to not fall in the weaponisation of the dollar, there was a recent article by a former CIA advisor talking about this I will try to link it.
"Countries" - Russia, China, India
Yes they're worried about weaponization of the dollar, and they should be, but they aren't going to succeed long term trying to avoid it.
Russia is just straight fucked at this point. It's economy hasn't been great for ages, and this war is just going to leave them living as an amputee afterwards. It's the same size as a Canada economically at this point...
China is on the edge of a major economic decline. In the last couple of years the last of their population boom just entered the workforce, and now there are significantly more people aging out of the workforce than joining it (and it will be that way for at least 20 years even if they managed to turn their birth rates around today. The results of their one-child policy coming home to roost. They're trying to strike while their iron is hot right now. This is all on top of the fact that their large population is becoming less and less relevant economically due to technology.
India is simply too far behind, it's barely 1.5x the GDP of Canada at only 3 trillion, despite having 35 times the population.
https://www.bloomberg.com/news/articles/2023-07-17/india-indonesia-plan-local-currency-trade-fast-payments-links https://ca.sports.yahoo.com/news/india-ties-uae-settle-trade-114534898.html https://archive.is/K279M https://www.al-monitor.com/originals/2022/07/iran-says-us-dollar-officially-ditched-trade-ally-russia https://www.reuters.com/world/americas/what-brazil-argentinas-currency-union-really-means-2023-01-23/ https://en.mercopress.com/2023/07/04/argentina-insists-on-local-currency-agreements-within-mercosur https://www.tbsnews.net/bangladesh/bangladesh-diversifies-trade-currency-transactions-begin-rupee-663326
Indonesia, UAE, Argentina, Brazil, Iran, Bangladesh, Sri Lanka, etc. While these countries are not actively 100% ditching the dollar right now the simple fact that they are starting to use alternatives speaks of a trend. And we still need to wait for the BRICS to release their plans on their currency, after which the process will accelerate more. It is not only 3 countries, and it is, in my opinion, not so important how much economic power they have, but rather that the strength of the dollar lies in its universal use.