De-dollarization the path to global financial freedom
Economic and financial sanctions often backfire. The most notable example is the weaponization of the dollar against Russia. The measure has sparked a global movement to de-dollarize, the opposite of the punitive move’s strategic intent.
The historic miscalculation didn’t stop US Senator Marco Rubio of Florida from introducing a bill in Congress to punish countries that de-dollarize. The bill seeks to ban financial institutions facilitating de-dollarization from the global dollar system.
Rubio’s bill, ominously called the Sanctions Evasion Prevention and Mitigation Act, would require US presidents to sanction financial institutions using China’s CIPS payment system, Russia’s financial messaging service SPFS and other alternatives to the dollar-centric SWIFT system.
Rubio is not alone in targeting countries bidding to de-dollarize. Economic advisors to presidential candidate Donald Trump are discussing ways to punish nations that are actively shifting away from the dollar.
The Trump team has proposed “to sanction both allies and adversaries who seek active ways to engage in bilateral trade in currencies other than the dollar.” Violators would be subjected to export restrictions, tariffs and “currency manipulation charges.”
Awakening BRICS
US policymakers and pundits in the financial media were initially dismissive of de-dollarization. They argued the dollar is used in some 80% of all global financial transactions. No other currency even comes close.
But financial sanctions against Russia, imposed after Russia’s military intervention in Ukraine’s Donbas region in 2022, became a turning point. The trend to de-dollarize expanded rapidly and has now arguably become irreversible.
In May this year, the Association of Southeast