Currently more than 60 percent of world foreign exchange reserves in dollars. The recent major changes. Surprisingly, the American media silent about this. A number of countries with the largest economy on Earth have made agreements with each other to rule out the use of the dollar.
Some oil producers also began selling oil in currencies other than the dollar, threatening the petrodollar system that runs for nearly four decades. Major international institutions, such as the UN and IMF, have even issued an official statement about the need to establish new global currency system replacement dollars.
Inevitably the dominance of the dollar as world currency would be threatened. »Shifting emerging currencies in international trade will of course be huge implications for the U.S. economy," said Michael Snyder, as quoted by Business Insider, Monday, March 26, 2012.
China is the countries most industrious encourage change. China has the second largest economic income in the face of the Earth. Level of China's economic growth is projected to surpass the U.S. in 2016. Even one of the economists predicts China's economy will be three times larger than the American economy in 2040.
Thus, the leaders in Beijing were sitting there and wondering, why should the U.S. dollar continuously so dominan if the Chinese economy will soon be number one on this planet?
Over the last few years China and other developing countries, like Russia, secretly made a deal to stay away from the U.S. dollar in international trade. Supremacy of the dollar it's not as tough as it is believed most Americans.
Here are 10 reasons why the triumph of the American dollar as the currency of the world will end soon.
# 1 China and Japan Get rid of Dollars
Several months ago the world's second largest economy (China) and the third largest economy on Earth (Japan) reach an agreement that will promote the use of their own currency (not dollars) in trade with each other.
This is a very important agreement, and the American media completely ignored. As reported by BBC, China and Japan announced plans to promote the direct exchange of their currencies. This is an effort to cut costs for companies and increase bilateral trade.
The deal will enable the company two countries directly change the currency in China and Japan. Currently businesses in both countries need to buy U.S. dollars before converting to the currency you want, so adding extra cost.
# 2 Plan BRICs Using Currency Yourself
BRICs group, consisting of Brazil, Russia, India, China, and South Africa, continues to show its teeth. The new agreement will promote the use of their own national currencies instead of U.S. dollars in trade with each.
News quoted from the media in India said, the five major emerging BRICs encourage greater economic momentum for the two groups signed a pact with them to promote intra-BRICs trade in the fourth summit of their leaders in Jakarta some time ago.
The signing of the agreement is expected to improve interstate commerce BRICs which has grown at a rate of 28 percent over the last few years. But the trade equivalent of U.S. $ 230 billion is still far below the potential of the five centers of economic power. But the trade equivalent of U.S. $ 230 billion is still far below the potential of the five centers of economic power.
# 3 Treaty Russia and China Currency
Russia and China have been using their own national currencies in trade with each other for over a year. The leaders of Russia and China strongly recommend the establishment of a new global currency for several years. Both countries seem determined to destroy the power of the dollar in international trade.
# 4 Increased use of Yuan in Africa
Who is Africa's largest trading partner? The United States? Not. Three years ago, China has become Africa's largest trading partner. China is now aggressively trying to expand the use of the Yuan or renmimbi, the Chinese currency, the Dark Continent.
A report from Africa's biggest bank, Standard Bank, recently declared, »We expect at least U.S. $ 100 billion (about 768 billion Yuan) in the Sino-African trade, which must be completed within renmimbi in 2015."
China seems to be really determined to change the way international trade. At this point some 70,000 Chinese companies use the Chinese currency in cross-border transactions.
# 5 The agreement of China-United Arab Emirates
China and the United Arab Emirates agreed to displace the dollar and use their own currencies in oil transactions with each other. UAE is a small player, but this is clearly a threat to the petrodollar system. What would happen if the petrodollars other oil producing countries in the Middle East follow?
# 6 Iran
Iran became one of the most aggressive countries away from the U.S. dollar in international trade. For example, India will use the gold to buy oil from Iran.
Tensions between America and Iran are not likely to close in the near future. Iran likely will continue to launch the action that could push the United States in the financial world.
# 7 Cooperation of China-Saudi Arabia
Who is the importer of oil from Saudi Arabia most? Not the United States, of course, but China. Panda country imported 1.39 million barrels of oil per day from Saudi Arabia in February, up 39 percent from a year earlier.
Saudi Arabia and China work together to build a major new oil refinery in Saudi Arabia. The leaders of both countries have been aggressively working to expand trade between the two countries.
Saudi Arabia's how long stick with the dollar if China is their most important customers? This question is very important.
# 8 Encourage the establishment of the United Nations New World Currency
The UN issued a report which openly calls for an alternative to the dollar as world currency.
In particular, a UN report said, "a new global reserve system" in which the U.S. no longer has dominance. "A new global reserve system can be created, which is no longer dependent on the U.S. dollar as the single major reserve currency."
# 9 IMF Proposes Bancor as a New Currency
The International Monetary Fund also publishes a series of reports calling for the U.S. dollar replaced as the world reserve currency.
One IMF document entitled "Reserve Accumulation and International Monetary Stability" published some time ago actually proposed a global currency future that is named "Bancor".
# 10 Many of the State of the World Hate America
Global sentiment toward the United States shifted dramatically. It should not be underestimated. Several decades ago the U.S. was one of the most beloved nations on Earth. Now they are one of the nations most hated. »If you (Americans) are still in doubt," said Snyder, »Try going to a number of countries."
Even in Europe (where it should have American friends), Americans are treated like dirt. »A lot of American travelers were forced to wear a Canadian pin so they will not be treated like trash while traveling there," said Snyder.
According to Snyder, the top ten reasons discussed in this article will not happen overnight, but it is important to note, this change will heat up. So when this great change? I do not know. Only time will answer.