The de-dollarization agenda is gaining steam as a total of 12 countries have mutually agreed to abandon the US dollar for trade. The dozen countries have taken to local currencies for cross-border transactions to end reliance on the US dollar. The development indicates that emerging economies want to strengthen their local currencies and give them a boost in the forex markets. The global hegemony of the USD is on a slippery slope and developing countries want to fill in the void.

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After the White House pressed sanctions on Russia in February 2022, the de-dollarization initiative was officially kick-started. Both Russia and China went on a world tour, convincing other countries to ditch the US dollar. The idea seemed lucrative as it provided a chance for local currencies to gain an upper hand in the markets.

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De-Dollarization Rising: 12 Countries Ditch the US Dollar For Trade

The Commonwealth of Independent States (CIS), which consists of 12 countries, has officially abandoned the US dollar for trade. The 12 countries have settled 85% of cross-border transactions in local currencies and not the US dollar. Only 15% of payment settlements have been made with the US dollar in 2024. The move shows that de-dollarization is growing, and there’s anger brewing towards the US dollar.

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“The use of national currencies is widening in mutual payments,” said Russian President Vladimir Putin at the CIS summit. “Their share in commercial operations among CIS participants has already been above 85%,” he said, indicating that de-dollarization is growing. “The process of import phase-out is moving quickly, and thus the technology sovereignty of our country is being strengthened,” he said.

The US dollar could lose out in the global supply and demand mechanics if de-dollarization further rises. Also, the currency could lose value as emerging economies diversify their reserves with gold and other assets. The next few decades could be a turning point where de-dollarization initiatives take on the US dollar.