Seems like the Chinese do not leave anything of strategic significance to pass, and they definitely excel when it comes to long term planning. I just came across on Facebook, this video of a Chinese Professor talking about de-dollarisation preparedness. She is Professor Keyu Jin of the London School of Economics. She was born in Beijing, China. Her father, Jin Liqun, is an economist and politician who previously served as the vice minister of finance of China and is the founding president of the Asian Infrastructure Investment Bank.
My knowledge of this was quite limited to the regular reports on plans linked to the emergence of BRICS. It must follow then that if China has a de-dollarisation strategy then the BRICS bloc are in the know, and likely drafting their own plans ( speculation).Anyways. I thought to familiarise myself with this development.
So yes, and no doubts, China has been actively preparing for de-dollarization as part of a long-term strategy to reduce dependence on the U.S. dollar in global trade and finance. The shift away from the dollar is driven by concerns over financial vulnerabilities, geopolitical risks, and the desire to enhance the international role of the Chinese yuan (RMB). With increasing geopolitical tensions and Western-led financial sanctions becoming a tool of economic warfare, China has been developing alternatives to the dollar-dominated global financial system.
One of the key elements of China’s de-dollarization strategy is the expansion of the use of the yuan in international trade. The Belt and Road Initiative (BRI), which spans over 140 countries, has been instrumental in pushing yuan-denominated transactions. Beijing has been signing currency swap agreements with multiple nations, allowing them to conduct trade without relying on the dollar. According to the People’s Bank of China (PBOC), over 40 countries have entered into such agreements, facilitating trade settlement in RMB.
China has also been promoting the Cross-Border Interbank Payment System (CIPS), which serves as an alternative to the Western-dominated SWIFT system. SWIFT has long been a chokepoint controlled by the U.S. and its allies, allowing them to impose financial sanctions. CIPS, while still reliant on SWIFT for some transactions, has been gaining traction as more Chinese banks and international partners integrate into the system. This allows China to conduct financial transactions independently, reducing the risk of Western financial coercion.
The Shanghai International Energy Exchange (INE) has also been a game-changer in China’s de-dollarization efforts. The INE launched yuan-denominated oil futures contracts, known as the “petroyuan,” providing an alternative to the petrodollar system that has dominated global energy markets since the 1970s. Major oil-producing countries such as Russia, Iran, and Venezuela, facing U.S. sanctions, have increasingly turned to yuan settlements for their crude oil sales. Saudi Arabia, a key OPEC member, has also expressed interest in conducting oil sales in RMB, signaling a potential shift in the balance of power in global energy markets.
China’s gold accumulation strategy is another critical aspect of its de-dollarization plan. The PBOC has been steadily increasing its gold reserves, using the precious metal as a hedge against dollar volatility and potential financial crises. Gold provides China with a buffer against currency fluctuations and strengthens the yuan’s credibility as a store of value. At the same time, Chinese financial institutions have been developing digital currency innovations, most notably the digital yuan (e-CNY), which has already been rolled out in domestic markets and is being tested for cross-border transactions.
China’s engagement with BRICS nations has further accelerated de-dollarization. The BRICS bloc, comprising Brazil, Russia, India, China, and South Africa, has been pushing for alternatives to the dollar in trade and investment. The BRICS New Development Bank (NDB) has increased lending in local currencies, and discussions about creating a common BRICS currency have gained traction. With Russia already largely cut off from the Western financial system, Moscow has been eager to collaborate with Beijing in developing yuan-based trade mechanisms.
Despite these efforts, the de-dollarisation process faces challenges. The U.S. dollar still dominates global trade and finance, accounting for over 50% of global foreign exchange reserves and nearly 90% of foreign exchange transactions. Many countries remain reluctant to shift away from the dollar due to its liquidity, stability, and historical trust. Additionally, China’s capital controls and concerns over financial transparency make some nations hesitant to fully embrace the yuan as a primary reserve currency.
Nonetheless, China’s preparations for de-dollarisation are a clear indication of its long-term vision for reshaping the global financial order. By reducing reliance on the dollar and creating parallel financial institutions, China aims to insulate itself from Western economic pressures while promoting the yuan as a viable global alternative. As geopolitical tensions continue to rise, the world may witness an increasing fragmentation of the financial system, with China leading the charge towards a multipolar currency landscape.
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Professor Keyu Jin of the London School of Economics video: China Has Prepared for De Dollarization!
https://rumble.com/v6rbu12-china-has-prepared-for-de-dollarization.html
https://www.tiktok.com/t/ZP82Watfx/
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