סאַודי אַראַביאַ עפענען צו טריידינג אין אנדערע קעראַנסיז ווי יו. עס. דאָללאַרס, סיגנאַלינג אַ יבעררוק צו דע-דאָללאַריזאַטיאָן

Saudi Arabia Open to Trading in Currencies Other Than the US Dollar, Signaling a Shift Toward De-Dollarization

After a 48-year relationship solely with the U.S. dollar, Saudi Arabia’s Finance Minister, Mohammed Al-Jadaan, said the kingdom is open to trading in currencies other than the U.S. dollar. The statements follow China’s president, Xi Jinping, urging the Gulf monarchs to accept yuan for oil, and Riyadh officials saying last March the country would consider accepting the Chinese currency.

Saudi Arabia’s Move Away from US Dollar Signals Changing Economic Landscape

This week, the world’s elite met in the Swiss Alpine town of Davos for the 2023 World Economic Forum, and Saudi Arabia’s Finance Minister, Mohammed Al-Jadaan, spoke to Bloomberg TV on Tuesday. Al-Jadaan stunned reporters when he said Saudi Arabia is open to trading in other currencies. “There are no issues with discussing how we settle our trade arrangements, whether it’s in the U.S. dollar, the euro, or the Saudi riyal,” Al-Jadaan said. The finance minister added:

איך טאָן ניט טראַכטן מיר זענען ווייווינג אַוועק אָדער רייזינג אויס קיין דיסקוסיע וואָס וועט העלפֿן פֿאַרבעסערן די האַנדל אַרום די וועלט.

The Saudi Arabian finance minister’s statements have been interpreted as another step toward de-dollarization. To understand why Al-Jadaan’s comments are significant, one must go back in time. In 1971, the U.S. government and President Richard Nixon ended the gold standard, and over the next three years, oil prices skyrocketed. In 1973 and 1974, federal officials and U.S. Treasury Secretary William Simon visited with monarchs in Riyadh.

סאַודי אַראַביאַ איז אָפן פֿאַר טריידינג אין אנדערע קעראַנסיז ווי יו. עס. דאָללאַרס, סיגנאַלינג אַ יבעררוק צו דע-דאָללאַריזאַטיאָן — “Our aim is really to bridge the divide, our aim is to be a force of communication and we are encouraging communication, whether it is China, the U.S. or others,” Mohammed Al-Jadaan remarked at the World Economic Forum in Davos.

אין דער צייט, די petro-dollar was born as Simon convinced the Saudis to sell oil in U.S. dollars and instructed them to purchase Treasury bonds. In addition to the Saudis, all of the Organization of the Petroleum Exporting Countries (OPEC) followed suit and priced their oil in U.S. dollars. Many believe this has given the U.S. an unfair advantage and that it has been the root cause of many of the wars the U.S. has been involved in over the last few decades. In more recent times, the U.S. dollar’s hegemony has been seemingly threatened.

Growing Saudi Tensions With U.S.

For instance, Saudi Arabia has recently been קאָנסידערינג joining the BRICS nations, which include Brazil, Russia, India, China, and South Africa. At the China-GCC summit, China’s President Xi Jinping urged Saudi Arabia to start accepting yuan for barrels of oil. Moreover, last March, Saudi Arabia האט it was thinking about accepting the Chinese currency for oil. The Wall Street Journal noted that the Saudis were ניט צופרידן with U.S. President Biden’s dealings with Iran over the country’s nuclear program.

אין אקטאבער קסנומקס, ריפּאָרץ further claimed that members of the Saudi government, including Crown Prince Mohammed bin Salman, privately mocked Biden’s mental acuity. Al-Jadaan detailed on Tuesday that the leaders in Saudi Arabia have a good bond with China and other nations.

“We enjoy a very strategic relationship with China and we enjoy that same strategic relationship with other nations, including the U.S. and we want to develop that with Europe and other countries who are willing and able to work with us,” Al-Jadaan remarked. So far, Saudi Arabia’s statements have been considered rhetoric, and none of the aforementioned considerations (accepting yuan for oil, joining BRICS) has come to fruition.

טאַגס אין דעם דערציילונג

אָלטערנאַטיוו קעראַנסיז, Bloomberg TV, בראזיל, בריקס, כינע, קרוין פּרינץ מאָהאַממעד בין סאַלמאַן, קראַנטקייַט, קראַנטקייַט דיווערסאַפאַקיישאַן, currency substitution, דאַוואָס, דע-דאָלאַריזאַטיאָן, decoupling, dollar substitution, פינאַנס מיניסטער, Gulf monarchs, העגעמאָני, אינדיע, דזשאָו בידען, Mohammed Al-Jadaan, monetary independence, monetary policy autonomy, monetary system reform, ייל, אָפּעק, פּעטראָדאָללאַר, ריטשארד ניקסאָן, רוסלאַנד, סאַודי אַראַביאַ, סאַודיס, דרום Africa, סאַווראַנטי, סטראַטידזשיק שייכות, האַנדל, טרעאַסורי קייטן, US Dollar, William Simon, וועלט עקאָנאָמיש Forum, שי דזשינפּינג, יואַן

What do you think the possible move away from the U.S. dollar by Saudi Arabia means for the future of global trade and finance? Let us know your thoughts about this subject in the comments section below.

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