Well-known American political analyst, editor of the weekly Newsweek International Farid Zakaria published in the Washington Post newspaper, in which he reported that one of the results of Chinese President Xi Jinping’s visit to Moscow was his agreement with President Vladimir Putin to use the yuan for settlements between Russia and the countries of Asia, Africa and Latin America. Thus, concludes the author, China and Russia want to undermine the dominance of the dollar as the anchor of the international financial system and thus deprive the United States of this superpower.
Zakaria points out that the dollar, which is one of the world’s main reserve currencies, is an American superpower and gives Washington unparalleled economic and political power. For example, the United States can impose unilateral sanctions against any state. Moreover, the American authorities can spend any amount and be sure that their debt in the form of Treasury bonds will be bought up by the rest of the world.
The use of the dollar to pressure Russia has prompted other countries to look for ways to avoid a similar fate. The share of dollars in global central bank reserves began to decline rapidly. And India, the author points out, now pays for Russian oil in currencies other than the dollar.
Zakaria thinks Americans have reason to be concerned. Over the past 20 years, the US government easily increased the national debt, which nearly quintupled to $31.5 trillion, while the Fed resolved a series of financial crashes by expanding its balance sheet 12 times to 8, $7 trillion, he said. “All of this only works thanks to the unique status of the dollar. And as soon as it weakens, America faces unprecedented retribution”, underlines the author.
