Apr 20, 2022
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The dollar begins to worry – what are the “barbarians” up to?

The dollar begins to worry - what are the

Photo: Nikolai Gyngazov/Global Look Press

Russia, China and Iran may create a trade and economic union, which, in the end, may lead to a weakening of the dollar. If they introduce a new currency, then this will allow them to abandon the “green” ones in the foreseeable future, says an economist and financial expert Jamshid Adalatyan.

“If several countries, such as Russia, Iran, China, other states that are under sanctions, can agree to create some kind of trade union and determine the currency that will be used in their transactions, and this currency will not be the dollar, then and the dollar will weaken, and global demand for it will gradually decline, ”the expert suggested in an interview with the Iranian media Resalat.

According to the economist, it will not be possible to quickly eliminate the dominance of the dollar from the world level, because not only oil is traded in dollars these days, but the cost of many raw materials and thousands of goods is determined globally based on the price of the dollar, even cryptocurrencies are determined by the dollar. So in order to force it out of the world economy, it will take three decades.

Jamshid Adalatyan believes that national currencies, at least the Iranian rial and the Russian ruble, are not very suitable for the role of money used in mutual settlements. In general, everything is complicated with the rial, and the ruble causes a wary attitude. The fact that Russia decided to sell oil and gas only for rubles, of course, kept the ruble from falling, but it did not arouse enthusiasm among the partners.

“The president’s directive is to methodically and consistently work towards expanding the range of use of national currencies,” he said. Dmitry Peskov. “Now it would be wrong to give some exact dates for which groups of goods, when it is possible to switch to the use of national currencies.”

At the same time, India and China are actively trying to reduce the role of the dollar in the global economy. The Celestial Empire has already created an analogue of the SWIFT global financial messaging system, which is called CIPS. It’s not hard to guess what’s in this new one. the global system is dominated by the yuan.

– China, Russia and Iran have a clear trend towards rapprochement, believes Andrey Bunich, President of the Union of Entrepreneurs and Tenants of Russia Iran has been under sanctions for a long time, so it has long redirected a significant part of the economy to China. Tehran has long been accustomed to circumventing the sanctions imposed on it, there is already a well-established system of existence in such conditions.

Russia, of course, plays a much more important role in the global economy. And in our case, we are not talking about circumventing sanctions, but about creating a new system. And China understands that further sanctions will be imposed on it.

I also agree that other countries that have fallen under sanctions will join this union. Cuba, Venezuela, Syria, Libya, Iraq… Soon half of the world will fall under sanctions. Many countries understand that the same fate may await them and are looking at who to join.

The expert believes that a new financial architecture will gradually form, a center of gravity, where new trade and logistics ties will be established. New trade and production chains will emerge.

“Now this trend is becoming powerful, and Russia is becoming a key participant. So it depends on her how fast this trend will develop. Or rather, on how ready the country’s leadership is to move forward without lingering in the Western system. Everything bad that the West could do, it has already done, but it can no longer do anything good. So the sooner we get out of there, the better for us. The sooner we will have new partners, relations with which we need to strengthen and develop.

joint venture»: Will a new world currency be created, will it not be possible to get by with rubles?

— I do not think that it is necessary to create a new world currency. The practice of their creation did not give anything good. It’s like a common language. They came up with a common language for all Esperanto. Back in 1887, by the way. But no one, except for a narrow circle of amateurs, began to speak it. So it is with the supranational currency.

The best example is the euro. But in fact, the same German mark is hidden under it. That’s just the creation of the euro led Europe to huge problems. This supposedly international currency is currently tied to the German economy, but it can be printed in other countries, which creates a lot of contradictions. And it is no longer clear who finances whom and at whose expense.

Many of the problems that the European Union faces are caused precisely by the fact that it uses a fictitious currency. But the euro is the most successful example!

Here is the Special Drawing Rights currency, invented by the IMF (supranational non-cash money, which only the IMF has the right to issue – ed.) It is not at all clear for what purposes it was created.

The expert is convinced that if the countries cooperate, then on the terms of clearing, on the terms of a single financial system, they can carry out mutual settlements in a way that suits them. The same yuan or the same ruble will be used in settlement schemes. Other countries can also join with their own currencies. With Russia they can pay in rubles, with China – in yuan, and so on. It must be a free system. Companies, private or public, as the new financial system develops, will choose what they pay for.

— It is clear that in the new financial system that is being created now, there will be leading currencies: the ruble and the yuan. And there is no need to strive for settlements in any one currency. This is also not very good: we can see from the dollar what happens when one currency appropriates the functions of all the others. This leads to abuse, – Andrey Bunich believes.

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