While addressing the Russian parliament, President Vladimir Putin discussed the issue of the US dollar’s dominance in global financial transactions and the potential impact on Russia’s economy. Despite concerns raised by many, President Putin stated that Russia has no de-dollarization plan.
Russian President Vladimir Putin has engaged in a conversation about the decline of the U.S. dollar’s supremacy, asserting that Russia is not responsible for the USD’s weakening. Additionally, Putin emphasized that de-dollarization is not an objective for Russia, underscoring worldwide developments that could potentially bring about the conclusion of the U.S. dollar’s prominence.
Putin engages in a discussion about the “Dollar’s Demise”
During a plenary session at the St. Petersburg International Economic Forum (SPIEF), Russian President Vladimir Putin addressed inquiries on de-dollarization and the potential decline in the dominance of the U.S. dollar.
When questioned about the allegations that he is leveraging Russia’s conflict with the U.S. to expedite the de-dollarization process, Putin was asked about the potential consequences for him if the U.S. dollar were to lose its dominant position in the global financial system. In response (as translated by Google), the Russian president replied:
“First of all, I want to say … we have never had and do not have the goal of de-dollarization of the Russian economy. And, there has never been and there is no goal of de-dollarization or influencing the de-dollarization of the world economy.”
Putin provided clarification by stating that the impact of a particular currency on the global economy is closely tied to the economic capabilities of the country that issues it.
The Shift in Economic Power: China Surpasses the US, Says Putin
Nevertheless, he firmly asserted that the current state of the U.S. economy is “inferior to the Chinese economy in terms of purchasing power parity.” He emphasized that the volume of the Chinese economy has surpassed that of the United States.
Despite his remarks, Putin acknowledged that the United States continues to possess a strong economy. He stressed that this achievement is an undeniable credit to the talented and capable American people. However, he pointed out that the current political leadership has been exploiting the trust placed in them by the American people.
Continuing the discussion of Russia has no de-dollarization plan; the Russian president delved into the topic of the U.S. government’s weaponization of the dollar and the potential ramifications if the USD were to lose its dominant position. This issue has sparked concerns among several parties, including Treasury Secretary Janet Yellen. Back in April, Secretary Yellen recognized the risks linked to employing financial sanctions in connection with the dollar’s role, cautioning that such actions could gradually erode the hegemony of the dollar.
The Shift Away from the Dollar: Global Reservations and Emerging Currency Alternatives
By utilizing the dollar as a tool of military confrontation, and there is no other way to express it, they cast doubt upon the reliability of the American currency both as a medium of exchange in global trade and as a store of value, as emphasized by Putin.
“The reserves of major economies worldwide in dollars are diminishing each year. Perhaps not as rapidly as some would desire, but they are diminishing,” Putin explained. “Similarly, settlements in the global economy denominated in dollars are decreasing, while settlements in euros are also declining. Conversely, settlements in national currencies, such as yuan and certain Arab currencies, are on the rise.”
The Russian president further remarked, “It is not coincidental that ideas and initiatives for creating their own currencies are emerging in Latin America, or that the Arab world has long been discussing the creation of its own unified national currency, and Asian countries are also engaged in these discussions. ”
In conclusion, Vladimir Putin’s remarks Russia has no de-dollarization plan shed light on the potential end of U.S. dollar dominance and the concept of de-dollarization. He highlighted concerns about the weaponization of the dollar, declining global reserves, and the rise of settlements in alternative currencies, suggesting a changing landscape in the international financial system.
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