According to data released by the Bank of Russia, the share of the ruble in Russia’s foreign trade operations continues to increase on a monthly basis. In May, 39% of payments for Russian export deliveries were made in the national currency, while 30% of import payments were also in rubles. This growth in the ruble’s share comes at the expense of the US dollar and euro, which have seen a decline in their share of payments for exports and imports, with the dollar accounting for 33% and the euro for 35% of payments.
Another notable development is the increasing use of the Chinese yuan in Russia’s foreign trade operations. In May, the yuan accounted for 25% of export payments and remained at 31% for import payments. In value terms, monthly export revenues in yuan increased from $7.4 billion to $8.4 billion, while import payments increased from $8 billion to $8.1 billion.
This trend of reducing reliance on Western currencies and increasing the use of national currencies in foreign trade began last year when Russia faced Western sanctions due to the conflict with Ukraine. Since then, Russia has actively sought to reduce the number of bank accounts and transactions involving Western currencies. Prior to the conflict, the US dollar and euro accounted for around 90% of Russia’s settlements.
The Russian Finance Ministry expects the share of Western currencies in Russia’s trade to further decrease to 10-15% by the end of the year. This signifies the country’s determination to shift away from the dominance of Western currencies and towards a more diversified and balanced foreign trade system.
In addition to the growing share of the ruble, the use of national currencies in Russia’s trade with other countries has also seen significant growth. As of June, the ruble accounted for 75% of settlements between Russia and the countries of the Eurasian Economic Union (EEU). In the case of Russia and China, over 80% of settlements were made in either rubles or yuan.
This shift towards using national currencies in foreign trade not only reduces Russia’s vulnerability to Western sanctions but also strengthens the country’s economic ties with its partners. By relying less on the US dollar and euro, Russia can mitigate the impact of currency fluctuations and reduce transaction costs.
Overall, Russia’s increasing reliance on the ruble and the use of national currencies in foreign trade highlights its commitment to diversify and strengthen its economic relationships. The country’s efforts to reduce its dependence on Western currencies signify a shift towards a more independent and resilient economic system.