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28 Jul, 2023 06:12

Russia wants to ditch dollar in trade with African countries

The weaponization of US currency has pushed many nations to look for alternatives, a top banker has said
Russia wants to ditch dollar in trade with African countries

Alternative payment mechanisms in mutual trade will be addressed at the ongoing Russia-Africa summit, one of Russia’s top bankers said on Thursday.

Speaking to journalists on the sidelines of the event in St. Petersburg, Andrey Kostin, the CEO of Russia’s second-largest bank VTB, said that the US dollar had been weaponized, which is why nations will gradually move away from using it in trade.

“Structural changes are bound to happen. African countries are also acting on this. They have already started to create their own systems of information exchange and settlements in national currencies. This is a promising trend,” Kostin said.

“A share of trade settlements in alternative currencies will continue to increase,” he concluded.

Russia and its trade partners among the developing nations, such as fellow BRICS members Brazil, China, India, and South Africa, have started to switch to alternative currencies in mutual trade after sanctions effectively cut Moscow off from the Western financial system. A growing number of nations have expressed their support of the trend.

President Putin revealed earlier this month that over 80% of transactions between Moscow and its largest trading partner, Beijing, are settled in rubles and yuan.

Russia announced plans earlier this month to launch negotiations on the switch to national currencies with countries in the Association of Southeast Asian Nations (ASEAN), namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.

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