In China’s foreign trade last year, the volume of payments in the renminbi has surged. The Chinese yuan’s challenge to the US dollar’s ‘dominance as a key currency’ is accelerating.
According to China Central Television (CCTV) on the 24th, the People’s Bank of China, the central bank of China, said at a briefing the day before, “Last year, China’s foreign trade settlement amount in renminbi increased by 37% from the previous year.” It rose by 2.2 percentage points,” he said.
In particular, after Russia, which invaded Ukraine last year due to Western sanctions, was expelled from the SWIFT settlement network, Russia agreed to settle in its own currency in trade with Russia, and Russia’s use of the yuan increased significantly.
According to the state-run Xinhua News Agency, the trading volume of the yuan on the Moscow Foreign Exchange Exchange in February this year was 1.48 trillion rubles (about 24.2 trillion won), surpassing the dollar (about 23.2 trillion won) to rank first in the monthly foreign currency trading volume for the first time. During this period, the yuan accounted for nearly 40% of the total trading volume on the Moscow Exchange. The dollar was 38% and the euro 21.2%. In February of last year, before Western sanctions, the dollar was 87.6% and the euro 11.9%, and the yuan was only 0.32%. Russian Deputy Prime Minister Alexandro Novak said on the 22nd (local time), “Russia will continue to use the ruble and renminbi in energy transactions with China. This trend will only expand,” he said.
China is also increasing the use of the yuan in transactions with other countries. China National Offshore Oil Corporation (CNOOC) recently made its first yuan-denominated liquefied natural gas (LNG) deal with French energy giant Total. The People’s Bank of Brazil made an agreement with the Central Bank of Brazil in February this year to set up a RMB clearing center in Brazil. The first yuan transaction between the two countries took place this month on the occasion of a recent visit to China by Brazilian President Luis Inacio Lula Dasiouba.
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Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.