Don’t understand why everyone and their grandmother is running this one:
In fact Russia and China have been trying to do more of their trade outside the dollar and specifically in national currencies since 2015. Here is a readout from the official page of the Russian Presidency on Putin’s meeting with Xi in Moscow for the May 2015 Victory Day parade:
We will continue to develop our financial sector cooperation, including through broader use of the ruble and the yuan in mutual settlements. Over the first two months of this year, we used our national currencies in more than 7 percent of settlements under our bilateral contracts.
We took another big step in this direction today. You saw that Sberbank has reached an agreement with its Chinese partners on providing credit lines in our national currencies and has signed the relevant accord.
We have launched new financial instruments: in March, the Moscow stock exchange began trading ruble-yuan futures.
We also plan to step up our investment cooperation and build up reciprocal capital flows. Let me note in this respect the work of the Russian-Chinese Investment Fund, which has invested 130 billion rubles in our countries’ economies. The plan is to raise this figure to 200 billion rubles over this year.
In fact Russia’s willingness to accept yuan for some of its oil was an important factor in allowing it to replace Saudi Arabia as China’s main oil supplier.
Likewise it is largely because of Russia-China non-dollar trade that 25 percent of Russia’s trade with BRICS is now done outside of the dollar (with a significant chunk of that in the euro.)
However Moscow and Beijing have also learned (as they probably suspected all along) that it is a lot easier to sign a declaration to switch away from the dollar than to actually do it. Justifiably or not dollar remains far more versatile, with many more willing takers than ruble or yuan.
The new “agreement” is more of the same. It is aspirational rather than prescriptive. Beijing and Moscow will do their best to encourage non-dollar trade, but the decision is with the companies involved, and it is not foreseen there will be any sort of “dollar dump”, but at best a further marginal move away from it. TASS:
Russia and China will sign an agreement on possible payments in national currencies. A decree of the Russian government on signing of a relevant agreement with the Chinese side was released on the official portal of legal information on Wednesday.
According to the draft decree approved through that government document, “settlements and payments for goods, service and direct investments between economic entities of the Russian Federation and the People’s Republic of China are made in accordance with the international practice and the legislation of the sides’ states with the use of foreign currency, the Russian currency (rubles) and the Chinese currency (yuan).” Economic entities agree on the choice of the payment currency and the way of payment independently.
The draft agreement also stipulates that Moscow and Beijing will cooperate in the field of functioning of national payments systems, as well as facilitate cross-border payments in national and other currencies.
“The sides deepen the cooperation in the field of national payment card systems and within the framework of the Russian and Chinese legislation provide support to commercial banks in their independent decision-making on joining the payment system in the state of the other side,” the document said.