YOGYAKARTA The United States dollar is threatened with losing its dominance. The reason is, several countries have started to leave the US currency in carrying out economic activities. Then, which country left the US dollar?
As is known, the United States has a considerable economic-related influence. This is due to many things, one of which is the use of their currency by various countries in the world.
The policy of various countries to leave the dollar itself is called dedolarization, namely efforts to change the dollar currency to other alternatives. Some countries that carry out de-dolarization are as follows.
Of the many countries that reduce their dependence on the US dollar, Indonesia is one of them. In fact, Indonesia's de-dolarization efforts have started since 2018.
Regarding the de-dollarization effort, Bank Indonesia (BI) is still intensifying the use of local currencies compared to US dollars through the settlement currency or local currency settlement (LCS). This step was carried out through bilateral trade transactions between Indonesia and partner countries such as Thailand, Malaysia, Japan, and China. LCS is not only used in trading, but in the investment sector.
China's move to reduce dependence on the US dollar seems to be quite intense. The country even signed a Local Currency Settlement (LCS) agreement with Indonesia. Thus, every transaction made between China and Indonesia will use local currency and no longer depend on the US dollar.
This means that in trading activities or investments involving China and Indonesia, there is no need to exchange money into US dollars. That way the need for US dollars on the market will be much reduced.
Efforts to reduce dependence on the US dollar were also taken by Brazil. The country has even collaborated with China to reduce dollar use and choose to use their currency, namely yuan and Real.
Cooperation between China and Brazil also has a large value because it reaches 171.49 billion US dollars. That way it can be ascertained that there are 171 billion US dollars that are not used in international trade.
Malaysia is one of Indonesia's partners in bilateral trade which is also trying to leave the US dollar through the LCS. The cooperation has started in the past year.
Not only with Indonesia, Malaysia also cooperates with India in every trade transaction to use the currency of their respective countries.
The Indian government has issued a new policy by increasing trade cooperation, namely the use of rupees in trading activities with partner countries, namely Malaysia and the United Arab Emirates (UAE).
With the UAE, trade transactions will use the local currency of rupees and dirhams for non-coal exchanges.
Apart from Indonesia, ASEAN countries are also starting to lean towards reducing their dependence on the US dollar through LCT. Currently, there is cooperation between several countries, namely Indonesia, Thailand, Malaysia, Singapore, and the Philippines in terms of payment transactions that can be made with a QR code, fast payment, including transactions using local currency.
Those are some countries that leave the US dollar. Visit VOI.ID to get more interesting information.
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