Russian President Vladimir Putin has stated that the decentralization of the finance system might benefit the global economy, allowing it to be more resilient in the long run. At the second Eurasian Economic Forum, Putin explained that building this decentralized system would allow for a depoliticized global economic arena, contributing to withstand crises derived from major events.
Putin States a Decentralized Finance System Will Benefit the Global Economy
Russian President Vladimir Putin has remarked on the importance of building a decentralized financial system for the global economy. As part of a speech during the second Eurasian Economic Forum, Putin explained the several benefits that a decentralized system would bring to the world economy. He stated:
Of course, the stability of all global finances will largely depend on this decentralization. The more de-centralized it is the better for the global economy. It will be less dependent on crisis developments in the countries that still have such an advantage as global reserve currencies.
Such decentralization of the financial system would bring better preparation for events like an eventual default of the U.S. debt, or a dramatic increase of inflation in the country, which would affect other countries using the U.S. dollar as a reserve and for international settlements.
In addition, Putin added that this decentralization will allow the depoliticization of the global economic arena, allowing for easier developments in the area.
Payments Decentralization
Part of this new decentralized global financial system that is being created has to do with the de-dollarization of payment channels around the world, and the switch to national currencies.
In this topic, the Russian Federation has been completing efforts to reduce the share of the U.S. dollar used for its international settlements, shifting to the use of the Chinese yuan and other national currencies with China and Iran, due to the unilateral sanctions that the U.S. government enacted against it, freezing billions of dollars in the process.
However, Putin noted that other countries are also moving in this direction, stating:
Many other fast-developing economies in the world are also shifting to the use of national currencies in foreign trade settlements, including China, India, Latin American countries.
The possible issuance of a common currency for the BRICS bloc of countries, revealed to be in discussion by Putin during the BRICS business forum last year, would also serve in this direction, allowing for the future development of alternative payment methods outside of the U.S. dollar and established traditional payment channel controls.
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