Wednesday, August 9, 2017

Disconnecting from the dollar completely is now a matter of National Security for Russia

The other day a foreign minister in Russia stated publicly that the Eurasian power was going to be looking at ways to wean themselves more and more off the dollar following the U.S.'s newest round of sanctions in their ongoing game of economic warfare.  Now on Aug. 9 a Chief economist for a Russian development bank stated that disconnecting from the dollar is now a matter of National Security, and the means to completely divest Russia's economic system from dollar use was imperative.

Russia needs alternative, independent payment systems that do not depend on foreign processing centers, and that the Mir national payment system is a step in the right direction. 
"This is a security matter. The Russian payment system needs to be independent, allowing us to live without fear of being hit by sanctions and getting our accounts blocked; it should allow us to use our money without having to worry about processing centers located beyond our country’s borders," Zubets explained. 
Meanwhile, Dmitry Polevoy, chief economist for Russia & CIS region at ING Bank, warnedthat the Russian economy may not be able to become independent from the US dollar anytime soon due to the fact that Russia’s status as major exporter of raw materials – for example, oil – which is globally priced in US dollars. 
"Therefore, a significant decrease in dependence on the US dollar can only be achieved by increasing the volume of non-raw material trade with the non-USD bloc countries," Polevoy said. 
However, chief economist of the Eurasian Development Bank Yaroslav Lissovolik pointed out that coordinated efforts by energy resources’ exporters may help them trade raw materials using national currencies and not just US dollars. 
"For example, if Russia and certain other natural gas exporting countries were to form an alliance, it would afford them more options for trading their commodity using payments in national currencies," he remarked. - Sputnik News
In the end, the more that Washington tries to isolate Russia by using the dollar as its primary weapon, the sooner nations as a whole will reject the reserve currency as a medium of exchange in international trade.  And this will quickly usher in a new monetary system that will either be one of direct trade using bi-lateral currencies, or an ultimate return of some form of resource or gold backed money.

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