Big Win for China as Russia Dumps Dollar for Yuan in Global Trading

Key Takeaways:

  • Russian President Vladimir Putin wants to use Chinese Yuan instead of the USD for international trade settlements
  • According to Putin, two-thirds of trade settlements between China and Russia is carried out in either Yuan or Rubbles
  • Chinse President Xi Jinping is in Russia for a three-day official visit
Russian President Vladimir Putin told President Xi Jinping he wants to use Chinese Yuan instead of USD to trade with countries
Chinese yuan wins big as Russia ditches the United States Dollar in international trade settlements. Pic Credit: Wallpaper Cave

YEREVAN (CoinChapter.com) — In what comes as a massive victory for Beijing, Russia has pledged to use the Chinese yuan instead of the US dollar to settle its trade with countries in Asia, Africa, and Latin America.

Russian President Vladimir Putin met his Chinese counterpart Xi Jinping during the latter’s official visit to Moscow, hailing the growing ties between Moscow and Beijing as both countries face growing pressure from the West.

Putin also gave some shocking statistics on the bilateral trade between the two economic giants.

“Two-thirds of the trade turnover between our countries is already carried out in rubbles and yuan. We are in favor or using the Chinese yuan in settlements between Russia and countries in Asia, Africa and Latin America,” 

Putin claimed in the presence of Xi Jinping’s delegation. 

Since Russia invaded Ukraine more than a year ago, the West, led by the United States, has imposed several sanctions on the Kremlin. In response, Moscow has moved closer to other economic giants, including China and India. 

Xi Jinping’s visit comes as a show of strength and symbolizes a muscle-flexing move by both countries against the United States.  

Russian President Vladimir Putin announced he would push for the wider adoption of Chine yuan in international trade settlements

Putin also hinted that his Government will push for the wider adoption of the yuan. 

“I am confident that these forms of settlement in yuan will develop between Russian partners and their counterparts in third countries,” 

he said. 

According to the Russian Central Bank, the share of China’s yuan in Russia’s import settlements in 2022 jumped to 23% from 4%. 

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Russia hails Chinese Peace Plan in Ukraine 

China has constantly provided a much-needed economic lifeline to sanctions-hit Russia following the invasion of Ukraine. However, Xi Jinping has also pushed for Beijing to play a larger role in global politics

Earlier this month, China brokered a truce between long-time enemies Iran and Saudi Arabia. Encouraged by this success, Xi vowed to increase his country’s role and influence on international affairs.

As part of China’s growing influence, Beijing has also looked to play a role in brokering peace between Russia and Ukraine.

The US, already irked by Beijing’s growing influence, slammed Xi. According to Washington, China has provided diplomatic and political support to Russia. As a result, Xi and his Government cannot be impartial brokers of peace in the conflict. 

However, Putin claimed that the Chinese Peace Plan holds merit. During the meeting, he also expressed willingness to implement the plan should Ukraine reciprocate. 

“We believe many provisions of the Chinese Peace Plan are consistent with the Russian campaign and can be taken as the basis for a peaceful settlement whenever the West and Kyiv are ready for it,”

 Putin said. 

As a part of the official talks, the two leaders signed several political and economic agreements to deepen ties. The latest move also highlights the commitment of both sides to offset the greenback’s worldwide dominance.

However, Moscow will not succeed in convincing all countries to adopt the yuan. Its ally India, for example, has already announced that it will discourage the use of yuan. Instead, the Indian Government has asked banks and traders to adopt the UAE Dirhams for trade with Russia.

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