Emre Gurkan Abay
June 07, 2021•Update: June 07, 2021
MOSCOW
Russia has fast-tracked its plan to reduce the use of the US dollar to hedge risks in the economy and international trade.
Several countries, including Russia and China, have in recent days expressed concern about the US domination in global trade through the dollar.
Speaking at St. Petersburg International Economic Forum (SPIEF) last week, Russian President Vladimir Putin accused the US of using the dollar as a tool of economic and political war. "The US will regret using the dollar as a sanctions weapon," he said.
"Russia's oil companies could stop using the currency which will harm the US dollar's global currency position," he added.
At the same event, the country's Finance Minister Anton Siluanov said that Russia will completely divest its dollar assets in the National Welfare Fund (NWF) within a month.
"We have decided to get out of dollar assets completely, replacing investments in dollars with an increase in euros and gold,” he added.
The share of Russian exports in US dollars has fallen to 48.6% in the last quarter of 2020, the lowest level in history, according to data compiled by Anadolu Agency.
The share of the dollar in Russia's exports was over 80% before US sanctions were imposed in 2013 due to the illegal annexation of Crimea by Russia.
According to data from the Central Bank of Russia, Russia increased the share of the ruble in international agreements with the Eurasian Economic Union (EAEU) from 54% to 70% between 2013 and 2019.
In the same period, the share of the ruble in Russia's exports outside the Commonwealth of Independent States (CIS) rose from 5.5%t to 8.7%, while its imports rose from 23.7% to 26.8%.
Additionally, Russia reduced the dollar's share of its exports to China, which is its largest trading partner, from 90% in 2013 to 60% last year.
Vyacheslav Volodin, the chairman of the State Duma -- the lower house of the Russian parliament -- said in March that they have increased the use of domestic currencies in trade with China and Turkey, as well as with the EAEU.
*Writing by Yunus Girgin
