Russia and China will develop shared financial structures to enable them to deepen economic ties in a way that foreign states will be unable to influence, the Kremlin has announced following talks between the countries’ leaders.
The move appears to be a response to a series of warnings that Western nations could push to disconnect Russia from the Brussels-based SWIFT financial system as a form of sanctions. This type of insulation would decouple both economies from the West and provide IMMENSE leverage.
Russian President Vladimir Putin and his Chinese counterpart Xi Jinping called for increasing the share of national currencies in mutual settlements and expanding cooperation to provide Russian and Chinese investors with access to stock markets.
Without being forced to use the SWIFT financial system the sanctions Western nations typically attempt to implement will be toothless. Much of this is result of the US Admin pushing Russia into the hands of the Chinese. Xi is making a powerful move here that will likely succeed.
Russian govt stated “particular attention was paid to the need to intensify efforts to form an independent financial infrastructure to service trade operations between Russia and China. We mean creating an infrastructure that cannot be influenced by third countries."
Both Russia and China are said to be increasingly looking to move away from using the US dollar as the main currency of international trade, instead using their own denominations to underpin the booming volume of Moscow-Beijing trade.
Last week, US Under Secretary of State Victoria Nuland said that the White House, along with a number of Western European nations, was mulling completely isolating Moscow from the global financial system should Russian troops dare to invade Ukraine.
This new agreement and system will subvert any such attempts by the US or NATO nations. This comes on the heels of Chinese President Xi Jinping backing Vladimir Putin’s demand for Nato to halt eastwards expansion. telegraph.co.uk/world-news/202…
Beijing backs Moscow’s demand for binding security guarantees that Nato will not expand in Ukraine or elsewhere in Eastern Europe. Xi added that “both China and Russia need to carry out more joint actions to more effectively safeguard our security and interests,”
Western policy has driven Moscow into the hands of the Chinese government. The Chinese model is in desperate need of decoupling from Western financial markets, the dollar, and in this new total agreement with Russia may have found solid ground for its sinking economy.
With the US Federal Reserve’s policy of quantitative easing – essentially flooding the global economy with an excess supply of money there is no better time for either of these two powerful nations to make a play to fully and completely upend the American global hegemony.
The American, and Western response generally will likely be strict sanctions at as rapid a pace as can be applied to attempt to apply pressure that prevents the new Russia-Chinese financial system from being born.
Should the two nations withstand the pressure and successfully implement the new system the global order created in 1945 will have officially ended. American and Western politics, economics, social conversations - everything will shift after this. To what only time will tell.
For those unfamiliar with SWIFT and why this is such a big deal, as of 2018, around half of all high-value cross-border payments worldwide used the SWIFT network, and in 2015, SWIFT linked more than 11,000 financial institutions in over 200 countries and territories.
To apply a definitive number to this, the SWIFT international payment network handles more than $1.25 quadrillion dollars per year. Now imagine the entire Russian and Chinese economies moving out and setting up their own shop. This is why it is world changing.
Not only does this shift economic power, but the introduction of alternative payment rails will likely make it difficult for western countries to track payments across the globe or use the SWIFT system as a political tool to threaten or put pressure on other countries.
As always, Be kind to your neighbors.
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