Russian Banker Predicts End of Dollar Dominance as Global Power Shifts

Russia’s second-largest financial institution’s chairman has predicted the tip of U.S. greenback dominance. He believes that the Chinese yuan will exchange the U.S. greenback because the dominant forex. “I think that the time has come when China will gradually remove currency restrictions,” he famous, including that “China understands that they will not become world economic power number 1 if they keep their yuan as a non-convertible currency.”

VTB Bank President Predicts End of U.S. Dollar Hegemony

Andrey Kostin, the chairman of state-controlled VTB, Russia’s second-largest financial institution, mentioned the potential finish of U.S. greenback dominance in an interview with Reuters, printed Friday. He expressed his perception that the period of U.S. greenback dominance is drawing to an in depth, attributing it to the growing prominence of the Chinese yuan and the worldwide recognition of the implications ensuing from unsuccessful Western sanctions geared toward undermining Russia in the course of the Ukraine disaster.

According to him, the U.S. and the European Union would lose resulting from their strikes to freeze a whole bunch of billions of {dollars} of Russian sovereign belongings. This prompted quite a few international locations to ramp up efforts to shift away from utilizing the U.S. greenback and settle trades in nationwide currencies, together with the BRICS nations (Brazil, Russia, India, China, and South Africa), 10 ASEAN member countries, and nine more Asian countries. The BRICS financial bloc additionally has a proposal for a typical forex that’s anticipated to be discussed at their upcoming leaders’ summit.

The Russian banker burdened:

The lengthy historic period of the dominance of the American greenback is coming to an finish.

“I think that the time has come when China will gradually remove currency restrictions,” he added. “China understands that they will not become world economic power number 1 if they keep their yuan as a non-convertible currency.”

Last month, he expressed a similar opinion in an interview with Sputnik. “There is every reason to expect that the Chinese yuan will replace the U.S. dollar as the world’s main reserve and settlement currency as early as the next decade,” the banker shared.

Kostin additionally commented on the sanctions imposed on him and his financial institution by the U.S. authorities. In February 2022, the U.S. Treasury Department introduced “unprecedented” and “expansive” sanctions towards VTB Bank and Sberbank — Russia’s two largest banks.

Moreover, the U.S. imposed sanctions on Kostin in 2018 resulting from Russia’s alleged disruptive actions on the worldwide stage. Subsequently, he was additionally subjected to sanctions by the European Union and Britain, with the latter referring to him as “a close associate of Putin.” Kostin expressed his view that these sanctions have been unjust and pushed by political motives, predicting that they’d finally have adverse penalties for Western international locations.

Regarding the Russia-Ukraine struggle, the banker warned:

We have already entered right into a sizzling struggle … It will not be chilly when there are such a lot of Western weapons and a whole lot of Western providers and army advisers concerned. The scenario is worse than within the Cold War, it is vitally tough and alarming.

Kostin opined: “Sanctions are bad, and we suffer from them, of course. But the economy has adapted … At the same time, we expect that sanctions will intensify, they will be tightened, some windows will be closed, but we will also find other opportunities.”

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