Simon Ng Russian President Vladimir Putin Addresses the Decline of US Dollar Dominance, Denies De-Dollarization Plans
During the St. Petersburg International Economic Forum (SPIEF), Russian President Vladimir Putin discussed the potential end of U.S. dollar dominance and refuted claims that Russia is actively pursuing de-dollarization. In response to questions about his alleged use of Russia’s conflict with the U.S. to expedite de-dollarization, Putin emphasized that de-dollarization has never been a goal for the Russian economy. He also highlighted global economic trends that could contribute to the diminishing influence of the U.S. dollar.
Putin’s Remarks on the “End of the Dollar”
During a plenary session at SPIEF, President Putin addressed concerns about de-dollarization and the potential consequences of the U.S. dollar losing its dominant position in the international financial system. When asked about Russia’s role in this process, Putin clarified (translated by Google):
“First of all, I want to say that we have never aimed to de-dollarize the Russian economy, nor have we ever sought to influence the de-dollarization of the world economy.”
Putin further explained that the influence of a currency on the global economy is directly linked to the economic power of the country issuing that currency. He acknowledged that the Chinese economy has surpassed the U.S. economy in terms of purchasing power parity, but he still recognized the strength of the American economy, crediting it to the talented and capable American people. However, Putin criticized the current political leadership for exploiting the trust of the American people.
The Russian president went on to discuss the weaponization of the U.S. dollar by the U.S. government and the potential ramifications if the dollar were to lose its dominance. This issue has raised concerns among various individuals, including U.S. Treasury Secretary Janet Yellen, who acknowledged the risks associated with using financial sanctions tied to the dollar.
Putin outlined the concerns, stating:
“When the dollar is used as a tool of military confrontation, and there is no other way to describe it, it raises doubts about the reliability of the American currency as a settlement instrument in global trade and as a reserve asset.”
He pointed out that the reserves of major economies held in dollars have been declining over the years, albeit not as rapidly as some might desire. Settlements in dollars are decreasing, while settlements in euros and national currencies, such as the yuan and currencies of Arab countries, are growing.
Putin also noted the emergence of ideas and projects for creating regional or national currencies, such as those in Latin America and the Arab world, which further diversify the global financial landscape. He clarified that Russia has no involvement in these developments and emphasized that if the trend of reducing dollar settlements and the emergence of oil and gas exchanges with non-dollar settlements continues, it could mark the beginning of the end for the dollar.
Putin concluded by expressing his belief that the actions of the current political elites in the United States are contributing to the negative consequences he mentioned, suggesting that those who do not embrace the trend towards multipolarity will ultimately suffer losses.
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Frequently Asked Questions (FAQs) about de-dollarization
What did Russian President Vladimir Putin discuss regarding the decline of US dollar dominance?
Russian President Vladimir Putin discussed the potential end of US dollar dominance during the St. Petersburg International Economic Forum (SPIEF). He emphasized that Russia does not have a de-dollarization plan and highlighted global economic trends that could contribute to the decline of the US dollar. Putin also mentioned concerns about the weaponization of the dollar by the US government and the consequences of the dollar losing its dominant position in the international financial system.
Is Russia actively pursuing de-dollarization?
No, Russian President Putin explicitly stated that de-dollarization has never been a goal for the Russian economy. He clarified that Russia has no intention to influence the de-dollarization of the world economy. Putin’s remarks emphasized that the influence of a currency on the global economy is related to the economic strength of the issuing country.
What are the potential consequences if the US dollar loses its dominance?
According to Putin, the potential consequences of the US dollar losing its dominance include doubts about the reliability of the American currency as a settlement instrument in global trade and as a reserve asset. He mentioned a decline in the reserves held in dollars by major economies, along with a reduction in settlements in dollars and an increase in settlements in euros and national currencies such as the yuan. Putin also highlighted the emergence of ideas and projects for creating alternative regional or national currencies.
How does Putin view the current political leadership in the US?
Putin acknowledged the strength of the American people and their capabilities but criticized the current political leadership for abusing the trust of the American people. He suggested that the actions of the political elites are contributing to negative consequences, potentially leading to the loss of US influence in the global financial system.
What are the global economic trends mentioned by Putin?
Putin noted that the Chinese economy has surpassed the American economy in terms of purchasing power parity. He also highlighted a reduction in dollar settlements and a growing trend of settlements in euros and national currencies like the yuan. Additionally, Putin mentioned the emergence of discussions and plans for creating regional or national currencies in Latin America, the Arab world, and Asia, indicating a diversification of the global financial landscape.
More about de-dollarization
- St. Petersburg International Economic Forum (SPIEF): Official Website
- Janet Yellen’s concerns about dollar hegemony: Bloomberg
- Purchasing Power Parity (PPP) comparison between China and the US: World Bank
- Trends in global currency settlements: BIS
- Putin’s remarks on de-dollarization and US dollar dominance: Kremlin Official Website
