Russia’s Finance Minister, Anton Siluanov, has revealed that more than 70% of trade between China and Russia is now settled in their respective local currencies. This substantial shift comes as both nations seek alternatives to the US dollar for international trade. Just a year ago, only 30% of trade between the two countries was conducted in local currencies. As the Chinese yuan gains prominence, it is clear that China and Russia are embracing the changes they have advocated for.
BRICS nations move away from US Dollar dominance
The rising influence of the BRICS nations has made headlines throughout the year. With the collective’s GDP (PPP) surpassing that of the G7 nations, the global power balance is visibly shifting. As these nations call for the elimination of the US dollar in international trade, their efforts are gaining momentum.
According to Siluanov, over 70% of trade between China and Russia is currently settled without using the US dollar. These countries have rapidly increased their use of the Russian Ruble and Chinese Yuan for trade settlements. Prioritizing local currencies in trade is mutually beneficial for both Russia and China.
Trade volume between the two countries reached a record $190.27 billion in 2023, representing a 29.3% increase from the previous year. The desire to diminish the relevance of the US dollar is not limited to China and Russia; Brazil’s president has also called for the BRICS nations to support the replacement of the international currency.
The growing use of local currencies in trade settlements between China and Russia signals a reduced reliance on the US dollar. As the BRICS nations continue to gain influence on the global stage, this shift could have significant implications for the international economy.