Russian President Vladimir Putin gave a recent update about the country’s increasing trade deals with China. Putin reinforced how Russia and China are using local currencies for cross-border transactions while making the US dollar redundant. Ever since the Russia-Ukraine conflict broke out in 2022, the Chinese yuan and Russian ruble have played a bigger role. The move is making other developing countries seek similar deals where their local currencies are used and not the USD.
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“I would stress that while trade figures are denominated in US dollar equivalents, transactions between Russia and China are carried out in rubles and yuan, with the dollar or euro share reduced to a statistical discrepancy,” said Vladimir Putin to Xinhua News. The statement comes after the high-level meeting with President Xi Jinping in China. Even India’s Prime Minister Narendra Modi was part of the talks in a joint effort to thwart Trump’s tariffs.
US Dollar On the Back Foot, Explains Putin
Russia is now the top exporter to China, with over 90% of the trade deals settled in the Chinese yuan and the ruble. The US dollar plays a minuscule role and would soon be brought down to 100%, explained Putin. “We continue our joint efforts to reduce bilateral trade barriers. Russia is one of the world’s principal markets for Chinese car exports,” he stressed. Despite multiple efforts, the White House is unable to stop trade deals between China and Russia.
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Putin also said in May that Russia and China are “reliably protected from the influence of third countries and negative trends in world markets (US dollar).” Since 2021 alone, oil trade between Russia and China has climbed over $100 billion and is only increasing in volume. The more pressure the White House exerts on developing countries, the more they are banding together as one. This includes rewriting trade policies to their benefit to safeguard their respective economies.
