Blinken's visit to China, the United States is determined to force China to choose between Russia and the United States, 240 billion yuan and more than 660 billion yuan, which side should China choose? Why is China-Russia trade, which is already almost entirely settled in its own currency, still threatened by US sanctions?
According to the official release of the Chinese Foreign Ministry, at the invitation of Chinese Foreign Minister Wang Yi, US Secretary of State Antony Blinken visited China from April 24 to April 26.
One of the most important goals of Blinken's visit is to pressure China to distance itself from Russia. For this reason, some Western media have already advocated that if China still refuses the US request this time, then the US is likely to impose new sanctions on Chinese financial institutions and banks.
U.S. Secretary of State Antony Blinken, Chinese Foreign Minister Wang Yi
At the same time, Russian Foreign Minister Sergei Lavrov also said in an interview with the media that Russian-Chinese trade and economic cooperation have developed in an all-round way, more than 90% of the trade between the two countries is carried out in their own currencies, and Russian-Chinese trade has been almost completely "de-dollarized".
This raises the question, since the trade between China and Russia has basically achieved "de-dollarization", why does the United States think that they can still restrict China through sanctions and force China to distance itself from Russia?
From the financial field, this involves many concepts such as direct sanctions and secondary sanctions, but in layman's terms, the logic behind it is actually very simple, that is, the United States will have a showdown.
The trade volume between China and Russia is $240 billion, and the trade volume between China and the United States is more than $660 billion, and what the United States means now is that if you want to do $240 billion in business with Russia, you can't do $660 billion in business with the United States; on the contrary, if you want to do business with the United States, you must give up Russia's $240 billion.
Sino-US trade
Specifically, for example, there is a Chinese bank that undertakes the business of trade settlement between China and Russia, and it stands to reason that since most of the trade between China and Russia is settled in RMB and has nothing to do with the US dollar, the United States has no way to sanction this Chinese bank.
But there is a problem involved in this, that is, China, as the world's largest trading country in goods, does not only do business with Russia, but also has a lot of business with other countries around the world, even the United States.
While the Chinese bank is responsible for the settlement of trade between China and Russia, it is likely that it is also responsible for the settlement of trade between China and the United States, Central Europe, and even China and other countries, and most of these settlements are carried out in US dollars.
Now the United States is threatening to sanction this Chinese bank, which in fact means that if any Chinese bank undertakes Sino-Russian trade settlements, it cannot undertake trade settlements with other countries.
Dollar
By extension, at the national level, this is to require all financial institutions and banks in China that have ties to the United States and the dollar to be forbidden to do business with Russia.
Obviously, from this point of view, the settlement of local currency trade between China and Russia does not prevent the United States from imposing sanctions on relevant Chinese financial institutions and banks.
Once Blinken visits China this time, China does not agree to the US demands, and if the US government really imposes sanctions on Chinese financial institutions as the US media has now said, it will inevitably affect China's interests.
If the United States really completely and thoroughly enforces the rule that once any Chinese bank or financial institution does business with Russia, it is not allowed to do business with the United States and not to use US dollars for settlement, then it is actually forcing China to choose between the United States and Russia.
美俄博弈
The logic is very simple, at present, in the global trade, the US dollar settlement still occupies more than 58% of the share, in this context, China, as the world's largest trading country in goods, how can it be completely left out of the US dollar in the international trade settlement?
Although many countries have begun to settle with China in their own currency, the share of local currency settlement is still relatively small compared with China's total foreign trade.
So how should we choose in the face of such a threat from the United States? Which side should China choose between Russia's 240 billion yuan trade volume and the more than 660 billion yuan of trade volume between China and the United States?
On the surface, this is a problem that does not need to be entangled, between countries, interests come first, of course, it is to choose more parties. However, if we look at the current situation of Sino-US relations in the medium and long term, we must of course plan for the long term and consider future developments.
China and Russia have close trade exchanges
The logic is very simple, on the one hand, the trade volume between China and the United States is not a "gift" from the United States to China, it is mutually beneficial and win-win for both sides. The United States is now saying that it wants to impose sanctions on certain industries in China, and it is in a posture of wanting a "showdown" with China, but in fact, its own economy simply cannot afford the price of "decoupling" from China.
If the United States wants to challenge China with this issue and force China to be unable to use the US dollar to settle global trade, it is actually digging into the corner of the US dollar hegemony and forcing other countries that have extensive trade with China to adapt to local currency settlement more quickly and accept the RMB as the settlement currency.
In short, don't look at the current posture of the United States, in fact, they don't dare to really kick China out of the global financial system dominated by the United States, otherwise, it will definitely be the dollar financial system that collapses first, not China.
Against the backdrop of fierce competition between the Democratic Party and the Republican Party, if the Biden administration deteriorates Sino-US economic and trade relations because of this issue, it will obviously be unfavorable, not only harming the economic interests of the United States itself, but also affecting the votes of the Democratic Party.
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On the other hand, from the perspective of the long-term interests of China and even developing countries around the world. Now the United States is pretending to be forcing China to choose between Russia and the United States because of the conflict between Russia and Ukraine, but in essence, this is not for Russia, but for the protection of dollar hegemony.
From this point of view, the United States is worried that if more and more countries bypass the dollar and use their own currencies to settle settlements, it will lose the opportunity to harvest other countries.
The local currency settlement between China and Russia can be called a benchmark for global "de-dollarization". China and the BRICS, as well as other developing countries around the world, are trying to get rid of the hegemony of the US dollar and are committed to establishing a global trade settlement system that is fairer and more beneficial to the vast number of developing countries, which will bring tangible benefits to third world countries.