Beijing and Moscow could together reduce their vulnerability to Western sanctions by divesting from the dollar and building their own financial systems to rival international versions, Moscow’s top diplomat has told Chinese media.
In a press conference held as part of a visit to the Asian country, Russian Foreign Minister Sergey Lavrov said that “the United States has declared its mission is to limit the technological development opportunities of both the Russian Federation and the People’s Republic of China.”
Amid a wave of sanctions from Washington, he added, the two nations can shore up their economies by “switching to settlements in national currencies and in world currencies, alternative to the dollar.” Lavrov added that “we need to move away from the use of Western-controlled international payment systems.”
The two economies, he said, needed to be insulated from the “quirks that are demonstrated by our Western partners.” The diplomat added “they are promoting their ideological agenda aimed at maintaining their dominance by holding back the development of other countries. This policy runs counter to the objective trend and, as it was customary to say, is on the wrong side of history.”
Last month, Lavrov’s deputy said that Russia had to go its own way when it came to financial systems. Sergey Ryabkov told Bloomberg that it was essential to preempt hostile confrontation with new President Joe Biden. “We need to barricade ourselves against the US financial and economic system to eliminate dependence on this toxic source of permanent hostile actions,” he said. “We need to cut back the role of the dollar in any operations.”
In December, the country’s central bank warned that Washington’s sanctions on foreign nations were relegating the importance of the dollar internationally. “Active use of the sanctions regime by the US administration in recent years is something that seriously undermines the reliability of the dollar as means of savings and payments,” the bank’s deputy chairman, Aleksey Zabotkin, told reporters.
When Biden took office in January, a number of analysts reported that the dollar would quickly strengthen, but faced longer-term challenges such as inflation and large-scale fiscal stimulus spending that could lead to “mixed feelings” about the currency.
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