The last 3 months have seen Russia's "de-dollarization" plans accelerate. First Gazprom clients shift to Euros and Renminbi, then the UK signs currency swap agreements with China, then NATO ally Turkey cuts ties and mulls de-dollarization, Switzerland jumps in the currency swap agreements, and BRICS create their own non-US-based funding vehicle, and then finally this week, Russia's oligarchs have shifted cash holdings to Hong Kong. But this week, as RT reports, Russian and Chinese central banks have agreed a draft currency swap agreement, which will allow them to increase trade in domestic currencies and cut the dependence on the US dollar in bilateral payments. “"The agreement will stimulate further development of direct trade in yuan and rubles on the domestic foreign exchange markets of Russia and China," the Russian regulator said.
In early July, the Central Bank’s chairwoman Elvira Nabiullina said Moscow and Beijing were close to reaching an agreement on conducting swap operations in national currencies to boost trade. The deal was later discussed during her trip to China.
President Vladimir Putin, during his visit to Shanghai in May, said cooperation between Russian and Chinese banks was growing, and the two sides were set to continue developing the financial infrastructure.
“Work is underway to increase the amount of mutual payments in national currencies, and we intend to consider new financial instruments,” Putin said after talks with President Xi Jinping.
It appears the deal is done...
The Russian and Chinese central banks have agreed a draft currency swap agreement, which will allow them to increase trade in domestic currencies and cut the dependence on the US dollar in bilateral payments.
“The draft document between the Central Bank of Russia and the People’s Bank of China on national currency swaps has been agreed by the parties,” and is at the stage of formal approval procedures, ITAR-TASS quotes the Russian regulator’s office on Thursday.
The areement will stimulate further development of direct trade in yuan and rubles on the domestic foreign exchange markets of Russia and China,” the Russian regulator said.
Currently, over 75 percent of payments in Russia-China trade settlements are made in US dollars, according to Rossiyskaya Gazeta newspaper.
And as we have explained repeatedly in the past, the further the west antagonizes Russia, and the more economic sanctions it lobs at it, the more Russia will be forced away from a USD-denominated trading system and into one which faces China and India.
Backing the strong horse, as always. “Fighters abandoning al-Qaeda affiliates to join Islamic State, U.S. officials say,” by Greg Miller, Washington Post, August 9, 2014 (thanks to Will):
U.S. spy agencies have begun to see groups of fighters abandoning al-Qaeda affiliates in Yemen and Africa to join the rival Islamist organization that has seized territory in Iraq and Syria and been targeted in American airstrikes, U.S. officials said.
The movements are seen by U.S. counterterrorism analysts as a worrisome indication of the expanding appeal of a group known as the Islamic State that has overwhelmed military forces in the region and may now see itself in direct conflict with the United States.
“Small groups from a number of al-Qaeda affiliates have defected to ISIS,” as the group is also known, said a U.S. official with access to classified intelligence assessments. “And this problem will probably become more acute as ISIS continues to rack up victories.”
The influx has strengthened an organization already regarded as a menacing force in the Middle East, one that has toppled a series of Iraqi cities by launching assaults so quickly and in so many directions that security forces caught in the group’s path have so far been unable to respond with anything but retreat.
U.S. officials attribute the Islamic State’s rapid emergence to factors both psychological and tactical. Its core group of fighters honed their skills against the armies of Syrian President Bashar al-Assad and the United States when it occupied Iraq. The group has used raids and ransoms to stockpile weapons and cash. And its merciless reputation triggered rampant defections among Sunni members of Iraq’s security forces already disenchanted with the Shiite-led government in Baghdad….
In Islamic theology, the People of the Book — those who have received prior revelations from Allah which they subsequently altered, to their disgrace and shame — must be warred against until they either convert to Islam or submit to Islamic hegemony and pay the jizya, a poll tax, to the Islamic state. The People of the Book include primarily Jews, Christians and Zoroastrians. (This is all based upon Qur’an 9:29). Groups that are not People of the Book, however, do not have the choice to submit. For them, it is convert or die.“Crucified by the Caliphate monsters: Iraq descends into apocalypse as Islamic State fanatics seize towns and tell terrified Yazidi ‘Become Muslims by noon today… or we kill all of you,’” by Ian Birrell,Daily Mail, August 9, 2014 (thanks to Pamela Geller):
They arrived bristling with heavy weapons and waving black flags from about a dozen Humvees, seized from the Iraqi army and supplied originally by the United States.
When the terrified residents looked out of their windows, they saw that Kosho, their traditional walled village in the mountains of northern Iraq, had been surrounded by jihadists. More than 200 bearded militants had besieged the village.
Then their leader – a local man from Mosul rather than the foreigners who make up more than a third of the ranks of the group now known as Islamic State – offered them a chance to save their lives.
‘He told us that either we become Muslims or they would kill us all,’ said Falah, mayor of the village made up mainly of members of the ancient Yazidi sect. ‘We offered money but they would not accept it.’
The deadline the people of Kosho have to meet is midday today. Since the residents refuse to betray their faith, it is feared an entire village of about 2,500 innocent people might be slaughtered in cold blood.
‘If we did not have families, we would try to escape,’ the stoical Falah told me yesterday. ‘But we have lots of women here and many children, along with all the old men and women of the village. How could we leave them?’…