The Petrodollar’s Long Goodbye, by Vijay Prashad

The dollar’s reserve currency status has allowed the U.S. the privilege of paying for goods and service with debt instruments it can create at will. The rest of the world is tired of this unfair arrangement. From Vijay Prashad at consortiumnews.com:

As part of their concern about “currency power,” many countries in the Global South are eager to develop non-dollar trade and investment systems, writes Vijay Prashad.

Xi Jinping and King Salman bin Abdulaziz Al Saud, Dec. 9. (CCTV/Wikimedia Commons)

On Dec. 9, China’s President Xi Jinping met with the leaders of the Gulf Cooperation Council (GCC) in Riyadh, Saudi Arabia, to discuss deepening ties between the Gulf countries and China.

At the top of the agenda was increased trade between China and the GCC, with the former pledging to “import crude oil in a consistent manner and in large quantities from the GCC” as well to increase imports of natural gas.

In 1993, China became a net importer of oil, surpassing the United States as the largest importer of crude oil by 2017. Half of that oil comes from the Arabian Peninsula, and more than a quarter of Saudi Arabia’s oil exports go to China. Despite being a major importer of oil, China has reduced its carbon emissions.

A few days before he arrived in Riyadh, Xi published an article in al-Riyadh that announced greater strategic and commercial partnerships with the region, including “cooperation in high-tech sectors including 5G communications, new energy, space, and digital economy.”

Saudi Arabia and China signed commercial deals worth $30 billion, including in areas that would strengthen the Belt and Road Initiative (BRI). Xi’s visit to Riyadh is one of his few overseas trips since the Covid-19 pandemic.

His first was to Central Asia for the summit of the Shanghai Cooperation Organisation (SCO) in September, where the nine member states (which represent 40 percent of the world’s population) agreed to increase trade with each other using their local currencies.

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