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March 20, 2023 · 2 min read

Saudi Arabia now uses yuan in trade with China

Tom KirkmanIndependent Project Manager

Saudi Arabia is now using yuan in bilateral trade with China.

China’s Belt and Road Initiative appears to be expanding in Saudi Arabia.

The details are not exactly forthcoming, but this is indeed notable.

The U.S. government should be paying more attention to this shift by Saudi Arabia, but apparently the U.S. government is more concerned about Ukraine than the petrodollar.

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“The Export-Import Bank of China (China EximBank), a major policy bank in China, announced on Tuesday that it has achieved the first loan cooperation with Saudi National Bank, the largest bank in Saudi Arabia, in yuan, facilitating financial cooperation under the framework of the China-proposed Belt and Road Initiative (BRI).

The move shows the rising role of the yuan on the international stage, expanding from trade settlement to loans, an expert told the Global Times.

The funds will be preferentially used to meet the demand of China-Saudi Arabia trade projects, China EximBank said on its official WeChat account.

… China and Saudi Arabia have made much progress in creating synergy between their strategies and conducting bilateral cooperation in various fields in recent years.

The Middle East country remained the single biggest oil supplier to China in 2022.

Bilateral trade reached $116 billion last year, up 33.1 percent on a yearly basis.

Imports from the Middle East country stood at $78 billion, up 37 percent year-on-year, according to China’s customs data. …”

globaltimes.cn ↗

FROM THE THREAD

Tom's notes 4

  1. Tom Kirkman

    Yep.

  2. Tom Kirkman

    Gary, while the USD is currently king, there is a shift happening.
    I keep drawing historical parallels to the fall of thr British Pound Sterling.
    Over 100 years ago, the British Pound Sterling was mighty, and England was a country to be reckoned with, with colonies all over the world, and a fearsome navy.
    50 years ago, 1 British Pound was worth 5 US dollars.
    Today, 1 British Pound is roughly the same as 1 US dollar.

    It is only a matter of time before non-Western nations band together and decide to use their own regional currencies, and hold less reserves of USD, which the US can sanction and control via SWIFT.

    Russia has already banned SWIFT.

    I certainly cannot prevent the inexorable devline of the US dollar, and a corresponding decline in the euro.

    ● Overuse of sanctions using USD and euro as blunt weapons of economic destruction against other countries is what will cause the decline of the petrodollar and the euro.

    Biden seems ready to literally start WWIII in order to stem the decline of the petrodollar. Insanity.

  3. Tom Kirkman

    Syed Muhammad Osama Rizvi
    Please see my comment below to Gary Davies. No point in repeating my comment again.

    You make good points, but in my view, economic sanctions are a bigger factor in the decline ofvthe USD than covid lockdowns. Although printing trillions of dollars out of thin air definitely created inflation and devalued the dollar.

  4. Tom Kirkman

    Mark Rohrbacher totally understand your comment. The shift away from the petrodollar will likely be slow and gradual. But inevitable.

    Abuse of sanctions using USD has scared to many non-Western countries, and they are starting to band together in defense of the USD as a sanctions weapon.

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