The US dollar is facing one of its most significant challenges in history: a group of 11 countries has decided to discontinue its use in international trade transactions.
These Commonwealth of Independent States (CIS) members are working to strengthen their local currencies, reduce reliance on the dollar, and increase competitiveness in foreign exchange markets.
This shift is part of a growing trend known as “dedollarization,” which gained traction after the US imposed sanctions against Russia in 2022.
The transition seeks not only financial independence, but also has the potential to significantly alter the global economic balance.
With 85% of cross-border transactions already carried out in local currencies, CIS leaders have emphasized that this decision strengthens their countries’ economic sovereignty and creates new fiscal opportunities.
Farewell, Dollar: All transactions have been halted, and bills of any denomination are no longer valid in the country.
Countries Saying Goodbye to the U.S. Dollar
A total of 12 countries have decided to stop using the US dollar for international transactions. So, which countries abandoned the dollar, and why? The countries that constitute the Commonwealth of Independent States (CIS) include:
- Armenia
- Azerbaijan
- Belarus
- Kazakhstan
- Kyrgyzstan
- Moldova
- Russia
- Tajikistan
- Turkmenistan
- Uzbekistan
- Ukraine
Despite recent conflicts between Ukraine and Russia, most of these nations have maintained close economic agreements and have decided to join this initiative.
Reasons Behind Abandoning the Dollar
The decision to move away from the dollar is driven not only by political motives but also by economic considerations. By reducing their reliance on the American currency, these nations aim to:
- Strengthen their own economic stability
- Promote local currencies
- Enhance regional economic cooperation
Countries are actively working to strengthen their domestic currencies in the foreign exchange market in order to mitigate the negative effects of international sanctions and diversify their reserves with assets such as gold.
Russian President Vladimir Putin stated that “the use of national currencies in mutual payments is expanding.” Their share of trade operations among CIS members now exceeds 85%. This strategic decision by Russia and ten other countries could have a significant impact on the US dollar.
What Impact Will De-dollarization Have on Global Trade?
The move towards de-dollarization represents a significant shift in the global financial system. By decreasing their reliance on the dollar, CIS countries could:
- Reduce U.S. influence in the global economy.
- Create new markets based on local currencies.
- Achieve greater economic stability amid dollar fluctuations.
However, this shift might also pose challenges for the U.S. currency. A decrease in demand for dollars in international trade could lower its value and impact its role as the leading global reserve currency.
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