A Shift Of Power: Russia and China Finalize Moves To Replace U.S. Dollar As World Reserve Currency
Russia and China recently agreed to establish a joint investment forum together to further their de-dollarization efforts. The new fund will be called the Russia-China RMB Cooperation Fund.
Russian President Vladimir Putin held talks with Chinese President Xi Jinping on July 4th during the meeting the two leaders discussed furthering bilateral ties.
“We have expressed our support for the agreement between the Russian Direct Investment Fund (RDIF) and the China Development Bank towards the creation of a joint investments fund worth 65 billion yuan $9.56 billion. We agreed to continue consultations on a more wide use of national currencies in mutual payments and investments. I am sure that the opening of the first foreign office of the Central Bank of Russia in China will contribute to that,” Putin said.
Meanwhile, last month China and Russia held their 7th Financial Ministerial Dialogue in Shanghai striking a $11 billion dollar funding deal.
Additionally, while at the meeting, Russia's development bank VEB signed an agreement to attract 6 billion yuan or ($882.35 million) from China's Development Bank for innovations, including development of blockchain technologies. So it's a safe bet to invest in crypt0-currencies as China and Russia are backing blockchain technology.
Coincidentally enough the meeting took place where the infamous Shanghai accord was finalized in February 2016.
So what was the Shanghai accord and why haven't you heard about it?
It was essentially a meeting between central bankers who voted to begin pulling the plug on the U.S dollar by weakening it for imported inflation as well as weakening the Yuan according to former CIA financial analyst Jim Rickards.
"This consensus on a weaker yuan and dollar was the genesis of what became known as the “Shanghai Accord.” This was an agreement reached on the sidelines of the G-20 central bankers and finance ministers meeting in Shanghai on Feb. 26," Rickards wrote.
In other words it was a way to equal out the two currencies that are pegged together in value.
The Chinese and Russian economic moves don't stop there. Earlier this year in May, Chinese President Xi Jinping called for closer cooperation across Asia and Europe to support measures of anti-terrorism to finance, as leaders from 29 countries gathered to promote the Silk Road initiative a Chinese trade deal that would increase Beijing's global influence on trade and geopolitics Radio Free Europe reported.
This would solidify China as a new stronger global power ready to take on the role of being a dominant world reserve currency.
In March, Russia’s central bank opened its first overseas office in Beijing, coming one step closer to replacing the U.S. dollar as the world’s reserve currency.
The South China Morning Post reported the new office was part of agreements made between the two countries “to seek stronger economic ties.”
“The opening of a Beijing representative office by the Central Bank of Russia was a “very timely” move to aid specific cooperation, including bond issuance, anti-money laundering and anti-terrorism measures between China and Russia,” Dmitry Skobelkin, deputy governor of the Central Bank of Russia said .
Financial regulators from both countries agreed last May to issue home-currency-denominated bonds in each other’s respective markets, a move that is seen as the beginning of the dethroning of the U.S. dollar, as both countries have stated they would implement a replacement for years.
China opened up its gold market in 2016, an entirely separate system than the COMEX gold futures market in New York and the Over-the-Counter (OTC) trades cleared through the London Bullion Market. China and Russia have both been working to undermine the West and the U.S. dollar since China called for a new world reserve currency in 2009.
A Wikileaks cable titled “China increases its gold reserves in order to kill two birds with one stone” shows that China was already shifting some of its massive foreign holdings into gold and away from the U.S. dollar in 2009.
China again began stockpiling gold in 2013, when they bought JPMorgan’s building that previously housed its gold.The IMF and United Nations have even expressed agreement that it’s time to replace the U.S. dollar as the world reserve currency with what’s known as SDRs or special drawing rights . Then the Asian Infrastructure Investment Bank (AIIB) was planned between 2010-2012, and was fully operational by 2016.
“China has been pushing for the SDR to become more widely used for some time, as a way to challenge the dominance of the dollar without pushing the renminbi as a direct competitor,” Julian Evans-Pritchard, a China economist at Capital Economics in Singapore, told Reuters.
In 2014, Russian and Chinese central banks agreed on a draft currency swap agreement, which allowed them to increase trade in domestic currencies and cut the dependence on the U.S. dollar in bilateral payments made between the two countries.
That same year, China’s Foreign Exchange Trade System extended the yuan’s swaps trading to 11 currencies on the interbank foreign-exchange market, Bloomberg reported. Russia and China furthered the dollar’s divide in 2015, by setting up an alternative to the EU-based global currency messaging and interchange service or SWIFT called CIPS or (China International Payment System.)
China then approved the usage of the Russian Ruble over the U.S. dollar for its border city Suifenhe City, Heilongjiang Province in a pilot program . Later the same year, the two countries opened up an e-commerce platform called incubator in that same province.
Following years of work, on October 1st, 2016, the Yuan joined the IMF’s SDR currency basket.
The IMF did an analysis and concluded that financial instruments denominated in SDR would lower volatility and risk compared to holding assets in individual currencies, as well as save costs. “M-SDRs could, therefore, be attractive to investors and issuers by offering a prepackaged diversification option,” the IMF wrote .
For years now, Russia and China have buying gold in massive amounts and dumping U.S. Treasury bonds at an accelerating rate. Finally there is the BRICS alliance formed of Brazil, Russia, India, China and South Africa – to bypass and overtake the U.S. dollar as the world’s reserve currency.
Damn that would cause alot of change, especially for the usd. I see why they would invest in antiterrorism, some people are going to pretty dam pissed that their currency isn't doing well. Would be cool if the world started using gold and silver coins as a unifyied currency that many would agree on. And crypto as a backup. Thanks for bringing this to knowledge.
I dont care, I invest in STEEM
The dollar has been propped up as the "petrodollar" for decades, but as crude oil continues to be under pressure, the dollar becomes less and less relevant. Invest in BTC and physical metals!
Best advice I have seen all day :)
oh dam!!! buy BTC!
Why do Putin and China want to get rid of the dollar?
He's a silly little crabby.
Hello! My Voice for a good post!
nice post. thanks for sharing
For China it could definitely shake up the world but the Ruble has been terrible for decades. Hopefully, if Russia changes it will be for the better of the people and not just the puppet masters.
The ruble is one of the best performing currency.
While I'm sure the ruble may work for some it is one of the worst performing currencies in the world. Not sure where you got your information from but I did a lot of forex trading and the Ruble was usually one of the worst to go for. Maybe this will help https://www.bloomberg.com/news/articles/2017-02-19/the-half-of-russia-still-in-crisis-prepares-for-worse-to-come
Great articles, one after another
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they can try they can try they can try they can try, BUT THE CRYPTOOOOS! Gonna take the show
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Nice post. I just Followed you. Please follow me.
That should get the wars started! Just ask Kadafi oh you can't anymore, they killed him for going to the gold.
I think the SDR rather then a nations currency is more likely to replace it
Good time to diversify out of the USD... but the military industrial complex and intelligence agencies are likely working overtime to continue to meddle in the affairs of other countries to try to maintain the Dollar Advantage... fascinating times to say the least
My God this is scary do you think everybody will loose there U. S. Dollars?
Gold and silver are the real deal. Unless people stop buying the whole Fiat money crap, this wouldn't come even come to light
Really well done article on a VERY important matter.
I thought it was so good that I am including in my "MUST READ" article.
Keep up the great work and check it out if you like.
Followed u bud and awesome thank you glad u enjoyed it!
I enjoyed it cause its true and very influential on all our lives. I have been following this topic for a while. Glad someone put together a comprehensive piece!
Holy shit this is crazy I didn't see this anywhere else seemit may be on to something
You have obviously been following the wrong news. The shift have been in the making for quite a few years. This is not the first deal they have done.
I documented all of them in this article :)
Good! Fuck the dollar! Buy bitcoin, eth and stratis.
Interesting. Real news? 🐓🐓
I really don't get these type of news, they talk about change and in all of them the central banks are involved, now haven't we been constantly bombarded with the theory that all central banks including the Federal Reserve are owned by the Rothschids? So this would just be a new NWO stratagem?
trust me, at some point, sooner or later, chinese deagon will screw hard russian bear. russkis outer politics worsen on daily basis
God Bless Russia and the Russian people you RACIST!
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(Keywords: yuan, reserve, replace, gold, dollar, power, russia, china, finalize, moves, shift, central, bank, world, currency, shanghai)