Saturday, July 23, 2022

Russia and China announce a new global reserve currency

 by Phil T Looker

 22 July 2022

As our Currency Wars page has been warning for years,China and Russia are preparing to take down the the U.S. dollar and replace it with their own global reserve currency.  What may seem bizarre to people who rely on mainstream media for their news, there has been no mention at all of this event in the print or broadcast media of the USA, UK or European Union member states.

It was always on the cards that Russia, China and rest of the BRICS countries would use the CIA / NATO engineered war in Ukraine to launch the main thrust of their economic war on the west, in fact after having written so much in our Currency Wars page about the inevitability of Russia and China challenging the US dollar’s global reserve status, now, it’s happening we can only say: "We Told You So".

It should not surprise anyone who has been paying attention for the past few years, and in particular the current year to date, that Russia and China are strengthening their economic ties partly in response to Western sanctions on Russia as a result of the country’s war in Ukraine and partly because with COVID, Climate Change, the fuel crisis, runaway inflation, food shortages and the war vying for media attention it is an ideal time for Russia and China to make their move. And they have been preparing this dollar replacement strategy for at least the eight years we have been writing about it, and probably longer. 

What is more likely to surprise politicians and the economists who advise them however, is that rest of the BRICS countries, Brazil, India, China, and South Africa,  have joined Russia in the effort and are officially working on their own “new global reserve currency,” RT reported in late June. Three of these were supposed to be the west's allies and fully supportive of sanctions and isolating Russia economically and politically It seems those mainstream media writers who were quick to declare VladimirPutin a busted flush will have to eat their words as the Russian leader has outsmarted them all as they stood in line waaiting to kiss zelenskyyyyy's Ukrainian arse.

“The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,” Vladimir Putin said at the BRICS business forum last month.

And as we reported IN 2015 Russia, in collaboration with China set up its own system for processing international financial transactions, almost as if The Kremlin anticipated the western powers would cut off Russian companies from the SWIFT system. With this system in place for several years it will not be difficult to work  with China and the BRICS nations to develop “reliable alternative mechanisms for international payments” in order to “cut reliance on the Western financial system.”

In the meantime,  and again as we predicted earlier this year, Russia is also taking steps to strengthen the alliance between BRICS nations, including re-routing trade to China and India, and via proxies to the west in order to beat sanctions according to CNN:

President Vladimir Putin said Wednesday that Russia is rerouting trade to "reliable international partners" such as Brazil, India, China and South Africa as the West attempts to sever economic ties.

"We are actively engaged in reorienting our trade flows and foreign economic contacts towards reliable international partners, primarily the BRICS countries," Putin said in his opening video address to the participants of the virtual BRICS Summit.

In fact, “trade between Russia and the BRICS countries increased by 38% and reached $45 billion in the first three months of the year” this year, according to that report. Meanwhile, Russian crude sales to China have hit record numbers during Spring of this year, replacing Saudi Arabia as China’s primary oil supplier.

"Together with BRICS partners, we are developing reliable alternative mechanisms for international settlements," Putin said.

In June, Putin also accused the West of ignoring"the basic principles of [the] market economy" such as free trade. "It undermines business interests on a global scale, negatively affecting the wellbeing of people, in effect, of all countries," he said. Love him or hate him you have to admire Vlad's chutzpah.

President Xi echoed Putin’s sentiments, according to a June writeup by Bloomberg.

It is gobsmacking stunned that nobody in western media or the politcal establishment seems to care that arguably the largest shift on the global macroeconomic playing field over the last half century may be taking place.The whole balance of power is being shifted from west to east, aided and abetted by incompetent, virtue signalling retard politicians who have been quite happy to let a seventeen year od Swedish schoolgirl dicate energy and economic policy to them. No wonder the Russian and Chinese leaders are running rings round them.


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