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China-led SCO bloc agrees to expand trade in national currencies

Published 09/16/2022, 09:08 AM
Updated 09/16/2022, 09:11 AM
© Reuters. FILE PHOTO: Saudi riyal, yuan, Turkish lira, pound, U.S. dollar, euro and Jordanian dinar banknotes are seen in this illustration taken January 6, 2020. REUTERS/Dado Ruvic/Illustration

SAMARKAND, Uzbekistan (Reuters) - The leaders of the Shanghai Cooperation Organisation (SCO) agreed on Friday to take steps to increase the use of national currencies in trade between their countries, according to a joint declaration adopted on Friday.

The group - which comprises China, India, Russia and Pakistan alongside four Central Asian states - said "interested SCO member states" had agreed a "roadmap for the gradual increase in the share of national currencies in mutual settlements", and called for an expansion of the practice.

No further details were provided and the group did not say who the "interested states" were.

Moscow is seen as the main driver of the push towards national currencies as it tries to reduce its reliance on the U.S. dollar and other Western currencies for trade following the imposition of sweeping new Western sanctions in response to its invasion of Ukraine in February.

Last week, the Russian gas producer Gazprom (MCX:GAZP) said China would pay for half its Russian gas supplies in roubles and half in Chinese yuan. Previous contracts have been denominated in euros or dollars, the dominant reference currency for global oil trade.

Leading oil producer Iran, like Russia subject to broad international economic and financial sanctions, is also on the verge of joining the SCO.

Latest comments

all US can do is just print easy money and now as inflation as excuse to increase rate and let the rest of the world to rush to buy USD. the only way to counter this is stop trading with USD..
Lets see if this will work when Russia is imploding after loosing the war in ukraine.
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