In the process of global "de-dollarization", Brazil has played a resounding shot this time, and China's renminbi has also ushered in a historic step. Doesn't Biden panic when the "hard money" stops being "hard"?
Russian President Vladimir Putin has said that "the global 'de-dollarization' wave is accelerating and irreversible", and US Treasury Secretary Janet Yellen has also vaguely expressed that "the status of the dollar in the global economic and trade order is indeed declining". Now the trade between China and Brazil has officially opened this process, and the Bank of China (Brazil) Co., Ltd. announced that on September 28, the trade between the two sides realized the first full-process closed-loop transaction in local currency, and realized the full-process closed-loop operation of RMB pricing, settlement, financing and direct exchange. This is a Brazilian Eldorado pulp company, the annual production of about 40% of the product is sold to China, although only 43 boxes of pulp were shipped to China, but it has to be said that it is a historic progress. In April this year, during the visit of Brazilian President Luiz Inacio Lula da Silva to China, China and Brazil signed a memorandum of understanding on cooperation, of which promoting local currency trade is the main focus. After the just-held summit of the Group of 77 and China, Chinese representatives will also pay official goodwill visits to Brazil, Cuba and Egypt around September 22. It can be seen that in about six days, Brazil has received a strong signal to jointly fire a shot in the process of "de-dollarization".
When the world is in full motion to promote the epoch-making process of "de-dollarization", no one can ignore the key role played by China. One is that China plays a key role in the global trade order, with strong demand for energy exporters such as Russia and Saudi Arabia, as well as significant supply capacity for consumer markets such as Europe, Japan and South Korea. It can be said that the international market of RMB is becoming more and more extensive, and the circulation channel is changing from two-way to multi-directional. The second is that China has the world's most comprehensive manufacturing industry, the most complete supply chain, it can be said that with the renminbi in China can buy any goods needed. To some extent, it can also fulfill the role of "hard currency". The third is that the RMB is issued with actual assets to make credit endorsement, rather than a few private banks like the Federal Reserve to hold a meeting and make a decision to raise interest rates or shrink balance sheets based on financial means. The political risk is far less than holding dollars.
In fact, what China really wants is not a single transaction or project that uses the yuan as a means of circulation, but a trend, and now Brazil is leading the way, and the rest of the world will not wait and see for long. The most important positive significance of the realization of local currency trading between China and Pakistan is that there is another case of "de-dollarization" within the BRICS framework. Especially this BRICS expansion, let Saudi Arabia, Egypt, these countries become members, these countries are all over the Middle East, Africa, the Americas, and the economic and industrial structure is different. It can be seen that the breadth and depth of the BRICS framework cooperation mechanism has been substantially improved, and these countries have a very strong "de-dollarization" intention. The power of these countries to "stick together for warmth" cannot be underestimated. Although the Biden administration does not say it, it also understands that this wave is unstoppable, and the root contradiction is precisely the hegemonic system on which the United States depends.
The global economic, trade and monetary order rooted in American hegemony allows some countries to eat soup, while others have to break their spines for US capital to enjoy. In the long run, the intensified oppression of the United States has turned the political direction of many countries, and the voice of "resistance" has become increasingly high. In fact, there are people who call for it, but we are also very rational and clear that after the US dollar, who can bring about a new and fair order? I'm afraid no one else has the strength or the guts. Now we are feeling the stones across the river, hoping to find a new way to meet the development that suits each other and is more diversified. When the dollar becomes a scrap of paper, a new order will emerge.