On December 27, 2023, Russia and Iran reached an important agreement in the economic and trade sphere, agreeing to use their local currency instead of the US dollar for bilateral** settlements. This news has attracted a lot of attention from the international community, as it marks an important step forward for both countries in dealing with the hegemony of the dollar.
Russia and Iran are both economic powers sanctioned by the United States and have long faced restrictions and inconveniences in dollar settlements. In order to break this situation, the two countries began to look for ways to settle in their own currencies. After many consultations and efforts, the two sides finally reached this agreement.
The conclusion of the local currency settlement agreement will bring many benefits to the economic and trade cooperation between Russia and Iran. First of all, local currency settlement will reduce transaction costs between the two countries and improve efficiency. Second, local currency settlement will reduce dependence on the US dollar and reduce the risk of fluctuations in the US dollar exchange rate. In addition, local currency settlement will also help promote financial cooperation between the two countries and promote the development of bilateral relations.
The promotion and application of local currency settlement will also have a certain impact on the international economic pattern. For a long time, the hegemony of the US dollar has given the United States a huge voice and influence in the global economy. However, with the development of the multipolar trend in the world, more and more countries have begun to seek to reduce their dependence on the US dollar and promote the diversification of the international monetary system. If more countries start to settle in their own currencies, it will help weaken the hegemony of the US dollar and promote the reform and improvement of the international monetary system.
Of course, the promotion and application of local currency settlement also faces some challenges and difficulties. For example, currency exchange rates in different countries may fluctuate greatly, requiring effective management and regulation. In addition, some countries may have problems such as imperfect financial infrastructure and information asymmetry, and it is necessary to strengthen financial cooperation and exchanges.
To overcome these challenges and difficulties, Russia and Iran can take a number of measures. First, the two countries can strengthen financial cooperation and exchanges, jointly improve financial infrastructure, and improve the transparency and profitability of financial markets. Secondly, the two countries can promote the continuous expansion of the application scope of local currency settlement, not only between ** and large enterprises, but also to the private sector and other fields. In addition, the two countries can also explore the possibility of cooperation with other countries in local currency settlement, and jointly promote the reform and improvement of the international monetary system.
At the international level, Russia and Iran can actively advocate for the international community to pay attention to the issue of local currency settlements and push more countries to join the ranks. In addition, the two countries can also use platforms such as multilateral institutions and international organizations to strengthen communication and cooperation with other countries to jointly address the challenges posed by the hegemony of the US dollar.
In conclusion, the agreement of Russia and Iran to use their own currencies instead of the US dollar for bilateral ** settlements is an event of great significance. This will not only help promote economic and trade cooperation and financial exchanges between the two countries, but will also have a certain impact on the international economic pattern. We look forward to the wider application and promotion of this agreement, which will make a positive contribution to the reform and improvement of the international monetary system. At the same time, we also hope to see more countries join the ranks to jointly address the challenges brought about by the hegemony of the US dollar and promote the multipolar and inclusive development of the world economy.