Pakistan wants to dump U.S. dollar, trade in yuan with China

The war on the U.S. dollar continues as yet another country is looking to veer away from the greenback and into another currency.

According to the Economic Times, citing the Minister for Planning and Development Ahsan Iqbal, Pakistan is mulling over a proposal to replace the U.S. dollar with the Chinese yuan for bilateral trade between Pakistan and China.

“We are examining the use of yuan instead of the U.S. dollar for trade between the two countries,” Iqbal said.

This has been the trend for much of 2017: countries dumping the greenback and seeking a different approach to trade. We wrote last week (SEE: 5 underreported economic news stories in 2017):

It appears that the U.S. dollar hegemony is at risk. Across the globe, there are countries that are attempting to veer away from utilizing the greenback. Even China may be signaling that it won’t be bullied anymore.

Here are just some of the developments over the last year:

Venezuela announced that it will launch a digital currency backed by oil, gas, gold, and diamonds. It will be called the petro and help “advance in issues of monetary sovereignty, to make financial transactions and overcome the financial blockade.” Caracas also said that it will no longer accept dollars.

Russian President Vladimir Putin urged lawmakers to support legislation that makes the ruble the main currency of exchange at all of the nation’s seaports next year. If approved, foreigners will be mandated to buy rubles – it will come with a transition period before ruble settlements are confirmed.

Reportedly, China is in the early stages of creating a crude oil futures contract that is priced in the yuan and can be convertible into gold, which will help crude exporters circumvent sanctions. This report came shortly after Treasury Secretary Steven Mnuchin warned the U.S. government would slap Beijing with sanctions if the nation didn’t support UN sanctions on North Korea.

Over the last several years, many countries have been gradually transitioning away from the greenback. You can definitely expect more moves like this in 2018.

Pakistan better watch its back. The country has already been suffering from a myriad of drone strikes. The American empire teaches foreign territories that if you dare shy away from the U.S. dollar, then you better prepare for retaliation.

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