In a recent interview with RIA Novosti, Russia’s representative at the International Monetary Fund (IMF), Aleksey Mozhin, revealed that more countries are shifting away from using the US dollar in international trade. Mozhin emphasized that this shift is a direct response to the conditions created by Washington, which have pushed nations to search for alternatives to the dollar.
Mozhin specifically pointed to the increasing use of alternative currencies in cross-border transactions, with the Chinese yuan being a prominent example. He highlighted how countries like Iran, Brazil, and Saudi Arabia are already adopting the yuan as their preferred trading currency, not just with China but also with other nations. This shift reflects a desire for greater diversification and reduced reliance on the US dollar.
According to Mozhin, the dominant position of the dollar in the global economy is a result of a lack of competition. He stated that the dollar currently accounts for the majority of international settlements and deposits worldwide, giving it an unfair advantage. However, Mozhin noted that American officials are starting to express concerns about the future of the dollar as more countries abandon it.
Mozhin acknowledged that the process of moving away from the dollar will not happen overnight but stressed that it has already begun. Nations are actively seeking alternatives to safeguard their own economic interests and reduce their vulnerability to potential US sanctions or economic pressure.
The use of the dollar by the United States for its own national interests and financial obligations is not a problem, Mozhin argued. However, he believes it is wrong for the dollar to be so widely used outside of the US, considering its potential impact on other nations’ economies.
Russia has been at the forefront of this shift away from the dollar. Last year, the country actively started replacing the dollar and euro in its foreign settlements. As a result, the share of these currencies in Russia’s international settlements fell from 90% in early 2022 to less than 50% by the end of the year.
Russian Deputy Minister of Economic Development, Vladimir Ilyichev, expects this trend to continue as more countries diversify their currency usage in international trade.
This move away from the dollar highlights the growing desire for a multipolar international financial system that offers greater stability and fairness. It reflects a global shift towards reducing dependence on a single currency, especially one that is subject to the policies and actions of one country.
As more countries explore alternative currencies, the global financial landscape is poised for change. While the process may take time, it is clear that the era of the dollar’s unrivaled dominance is slowly coming to an end.