China and Russia Ditch Dollar in Move Towards Financial Alliance

September, 2020

This source was attributed by China Economic Review

China and Russia ditch dollar in move towards ‘financial alliance’

Russia and China are partnering to reduce their dependence on the dollar — a development some experts say could lead to a “financial alliance” between them, reported the Financial Times.

In the first quarter of 2020, the dollar’s share of trade between Russia and China fell below 50% for the first time on record, according to recent data from Russia’s Central Bank and Federal Customs Service.

The greenback was used for only 46% of settlements between the two countries. At the same time, the euro made up an all-time high of 30%, while their national currencies accounted for 24%, also a new high.

Russia and China have drastically cut their use of the dollar in bilateral trade over the past several years. As recently as 2015, approximately 90% of bilateral transactions were conducted in dollars. Following the outbreak of the US-China trade war and a concerted push by both Moscow and Beijing to move away from the dollar, however, the figure had dropped to 51% by 2019.

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