After the start of the Ukrainian conflict, the role of the dollar as a “safe haven” for global investment was somewhat shaken, and many countries began to look for other objects for capital investment. So says Stephen Jen, CEO and co-founder of Eurizon SLJ Capital.
The rate of decline of the share of the US currency in world reserves over the past two decades has increased 10 times. This process has intensified especially after the start of the special operation of the RF armed forces in Ukraine, because this was followed by large-scale anti-Russian sanctions. In general, since 2016, the dollar has lost 11% of its share in the international currency market.
This was mainly reflected in countries whose reserves are mainly made up of dollars. Most of them are developing countries and economies of the Global South.
In this regard, a number of states are taking steps to de-dollarize, while India and China are trying to bring their currencies to a different level in international settlements after the West tried to disable SWIFT for Russian banks. At the same time, there are fears that the United States will use its currency as a tool for economic and political pressure.
The US dollar currently represents 58% of the world’s total financial reserves. In 2001, this figure was 73%.
Photos used: pexels.com
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