Although there are other factors involved in the global shift towards de-dollarization, fear of other countries getting sanctioned by the U.S. is accelerating the process.

La dédollarisation en marche

April 11, 2023

The International Community’s increasing efforts to decouple their trade relations from the dollar is following its course and is increasingly reaching the practical stage of things. On the Western, liberal side – the analyzes of the events try to be reassuring, minimizing the damage concerning the future of the American currency as the fundamental international means of exchange. But for the major non-Western powers and the countries of the global South – moving away from the dollar, or at least hedging their bets, the situation is fast moving away from the U.S. based currency.

What might have seemed almost impossible to Western analysts only a few years ago – has indeed taken off, and with confidence. When the international de-dollarization process is observed today, it must certainly be understood that it was completely unexpected, especially given the pace currently observed, neither by Washington nor its main followers in the Western space.

This is hardly surprising.

The first (Washington) considered that no one could touch its world domination, nor the hegemony established for many years. The followers, in particular Europeanists, wrongly thought that they were on the winning side and were therefore “untouchable.” Unlike Brussels Europe, much of the rest of the world is not a part of the world unware of the changes talking place in the world and oblivious to fast fading international realities that are being overtaken by contemporary events of the multipolar era.

Meanwhile, the figures and events related to the said process speak for themselves: agreements on the dedollarization of reciprocal exchanges and the transition to the use of the national currencies concerned continue to expand. One of the most recent dates being between India and Malaysia. And this follows other agreements between States going in the same direction.

In particular between China and Russia (respectively the first and sixth world economies in terms of GDP at purchasing power parity). Between China and Brazil (first and eighth world economies respectively), China and Saudi Arabia (first and 17th), Russia and Iran (sixth and 21st). In the case of India and Malaysia, this concerns the world’s third and 31st economies respectively.

Keep in mind that these processes have only just begun. On the Western side, the “specialists” of liberal obedience always try to want to be reassuring about the future of the dollar internationally, but nevertheless find themselves forced to recognize that it is necessary to prepare for a multipolar monetary world.

However, and on the side of the so-called countries of the global South, the observation and analysis of the facts is much more realistic and full of hope as to the future of de-dollarization, the latter defined by the excessive use of extraterritoriality US law as a legal lever of coercion, creating de-facto global control over all economic agents using US currency. And this vision, especially in Africa, is very often similar in both the North and the South of the continent, as well as in other places on the continental and international scale.

In general, and once again, the extreme of Washington’s arrogance and that of its main followers, as well as their firm conviction that they can act with total impunity, including vis-à-vis foreign financial assets that do not belong to them, represent the some aspects of the process now clearly under way in the four corners of the world. What is most important now is to maintain strong motivation for this process among non-Western nations. Clearly – the motivation is there.

Mikhail Gamandiy-Egorov

The original article appeared at Observateur continental in French