Russia, Iran, and Turkey Establish Foreign Trade Action Plan to Cease US Dollar Trade

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Russian Trade and Industry Deputy Minister Alexei Gruzdev has indicated that Russia, Iran and Turkey will establish a Foreign Trade Action Plan among themselves and will cease to use the US$ as a trading currency between them.

The sanction policies by the U.S., particularly related to Turkey, Iran, and Russia, have recently sent the national currencies of these three countries to historic lows, thus, the emergence of the need to look for alternative mediums for financial transactions that can decrease the domination of the dollar in global trade, said Gruzdev.

Turkey, Iran, and Russia can protect their firms and become independent from the actions of third countries by using national currencies in bilateral trade, he stated. Gruzdev said the use of local currencies in trade between the two countries is necessary.

Russia welcomes initiatives for the use of national currencies in trade with Turkey and Iran, Gruzdev noted, adding that Turkish, Iranian, and Russian institutions and companies have intensified initiatives to increase trade with rubles, lira, and even the Indian rupee, a major trading currency with Iran.

“In particular, using our national currencies under current conditions will increase our mutual trade. By using our national currencies, we can protect our institutions and become independent of the decisions of third countries. We should make the mechanism of using ruble and lira more popular in our trade. If we increase this exchange between our banks, our companies will realize the advantage of this method and increase their usage.” Gruzdev explained.

Bilateral Trade 2018 (US$ billions) Percentage Growth
Russia/Iran 2 +17
Russia/Turkey 27 +37

Russian trade with Iran, which has been hit by sanctions is now on the mend and growing. Intrabanking facilities set up by both countries that bypass US dollar and US banking mechanisms are seeing a new, non-US monitored banking system emerge.

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