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US dollar losing luster in Russia’s foreign trade despite sanctions: Intl. audit firm

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
File photo shows Russian ruble banknotes and coins.

An international audit firm says Russia has successfully managed to decrease the use of US dollar in its settlements with its foreign trade partners, significantly increasing the number of deals in Russian rubles and euro.

“Tendency towards doing away with the US dollar on foreign trade is obvious. This is the way to a more stable economy and protection of it against sanctions,” said Elena Trubnikova, chairwoman of the board of FinExpertiza, a Russian network of professional audit, valuation and consulting firms, on Monday.

“This is mostly true for exports, as selling the goods for the national currency of the exporter is a natural order of things,” the RIA-Novosti further quoted her as saying.

According to a research conducted by the Moscow-based consultancy network, the share of settlements in Russia’s foreign trade using the US currency have been reduced by 12.6 percent between 2013, before Western sanctions were introduced against Russia, through 2018.

The research noted that during the same period, Moscow had managed to expand the range of foreign trade deals settled in euro by 26.6 percent. Furthermore, the share of settlement in rubles was boosted by 14 percent, it added.

Back in 2014, Washington introduced its economic penalties through sanctions against Russia. The European Union (EU) supported the controversial move by the US.

Relations between Moscow and the rest of Europe have worsened since 2014, when Crimea rejoined Russia following a referendum where more than 90 percent of participants voted in favor of the move. The West brands the reunification as annexation of Ukrainian land by Russia, an allegation strongly rejected by Moscow.

In siding with Ukraine, the EU has followed Washington's lead in leveling several rounds of sanctions against the Moscow. Since then, the measures have been expanded for various reasons.

The Kremlin has so far taken a wide range of retaliatory counter-measures, including the steady reduction of Russia’s reliance on the US dollar in the scope of international settlements.

According to a report by the Russian international television network, RT, over the five-year period from 1013 to 2018, the share of the US dollar in Russia’s trade settlements reduced to 56.1 percent, accounting for $388 billion.

Moreover, the share of euro-dominated international trade transactions rose to 21.9 percent or the equivalent of $151 billion. Trade settlements in ruble, for its part, increased to 20 percent, or $136 billion, it added.

Elsewhere in her remarks, Trubnikova noted that the latest steps taken aimed at “de-dollarization” have increased the share of settlements in ruble and Chinese yuan in mutual trade between Russia and China.

She also added that Russia had increased by more than fivefold its ruble-based settlements with China, while yuan-based trade settlements in China’s exports grew by nearly nine times.

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