IMF executive director for Russia, Aleksei Mozhin, discussed the global trend of de-dollarization in an interview. He highlighted that countries worldwide are seeking alternatives to the U.S. dollar due to Washington’s policies and actions. The Chinese yuan is becoming increasingly popular for cross-border transactions, with Iranians, Brazilians, and Saudis already trading in yuan. Mozhin attributed the dominance of the U.S. dollar in the global economy to a lack of competition and acknowledged that some U.S. officials have expressed concerns about the currency losing its reserve status. Treasury Secretary Janet Yellen and U.S. Senator Rand Paul have both suggested that the use of financial sanctions could erode the USD’s hegemony. Mozhin expects a gradual decline in the dominance of the USD, stating that the process has already begun.
Russia is actively replacing the U.S. dollar and euro with alternative currencies in foreign settlements. The share of these currencies in Russia’s international settlements has dropped from 90% in early 2022 to below 50% by the end of last year. Russian Deputy Minister of Economic Development, Vladimir Ilyichev, predicts that this trend will continue. Mozhin criticized the widespread use of the USD globally, arguing that it is “wrong” for one currency to be so widely utilized for the national interests and financial obligations of a single country.
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