The New StatesmanThe New Statesman

Why China and its trading allies are well placed to topple the dollar

By Wolfgang Münchau

03 May 2023 · 4 min read

Editor's Note

The US may soon pay the price for using sanctions as a policy tool, according to The New Statesman's Wolfgang Muenchau. You can hardly blame countries for looking for alternative trading partners.

Change is good, but dollars are better, a US author of romance novels once wrote. A similarly light-hearted sentiment often inspires discussions about the future role of the US dollar as the world’s leading currency. The consensus view is that the dollar is safe. I think the consensus is wrong.

The dollar is the foundation of US global leadership, and the future of the dollar is therefore intricately linked to the debate about geopolitical fragmentation. Brazil’s president, Luiz Inácio Lula da Silva, asked during his recent visit to China: “Why should every country have to be tied to the dollar for trade?… Who decided the dollar would be the [world’s] currency?”

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