According to Alexey Maslov, director of the Institute of Far Eastern Studies at the Russian Academy of Sciences, the Russia-China “dedollarization” trend may reach a “breakthrough moment” leading to an alliance between the two countries.
Maslov goes on to argue that, “The collaboration between Russia and China in the financial sphere tells us that they are finally finding the parameters for a new alliance with each other.”
He added further, “Many expected that this would be a military alliance or a trading alliance, but now the alliance is moving more in the banking and financial direction, and that is what can guarantee independence for both countries.”
In the background, Russia’s Central Bank has cut their total greenback reserves by $101 billion, an equivalent to roughly half. At the same time, Russia has increased investment in Chinese currency, upping reserves from 5% to 15%.
For the U.S., the formation of a Chinese-Russian financial alliance poses difficulties. Since the later stages of the Obama Administration, the U.S. has been an adversary to both Russia and China on foreign policy issues.
