Summary:
Payments in national currencies among SCO members have increased from 40% to 92%.
The shift signifies a move away from reliance on the U.S. dollar.
SCO promotes local currencies to strengthen economic ties and support a multipolar world order.
The organization now includes 26 countries, with recent additions like Iran and Belarus.
China and Russia are enhancing cooperation in local currency usage and investment.
Payments in national currencies among the Shanghai Cooperation Organization (SCO) members have surged dramatically from 40% in 2022 to an impressive 92%. This significant increase indicates a strategic shift away from the reliance on the U.S. dollar. Much like the BRICS economic bloc, the SCO—comprising nations like Russia, China, India, and recently Iran—is advocating for the use of local currencies to bolster economic ties and foster a multipolar world order.
SCO Members Shift to National Currencies for Payments
At a recent press conference in Moscow, Dmitry Volvach, Russia’s Deputy Minister of Economic Development, announced the remarkable rise in the use of national currencies among SCO nations. He stated:
“In 2022, the share of national currencies in payments between SCO member states amounted to 40% … whereas now it totals 92%.”
This shift highlights a significant change in financial exchanges among member states, reflecting a growing trend towards local currency utilization.
Established on June 15, 2001, the SCO initially consisted of Russia, Kazakhstan, Kyrgyzstan, China, Tajikistan, and Uzbekistan. The organization expanded in 2017 to include India and Pakistan, and Iran became a full member in July 2023 after applying in 2008. Additionally, Belarus is on track to gain full membership after signing a memorandum at the New Delhi summit in June, bringing the total number of countries in the SCO to 26 when including dialogue partners and observers.
Both the SCO and BRICS are committed to promoting national currencies to minimize dependency on the U.S. dollar in global trade. The BRICS alliance comprises Brazil, Russia, India, China, and South Africa, with new members such as Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE joining recently.
These organizations, sharing several member countries, are intensifying efforts to reinforce economic ties and advocate for a multipolar world order by enhancing the usage of local currencies in trade and investment. Recently, China and Russia have deepened their cooperation in currency and finance within the BRICS framework, following a meeting between Chinese Premier Li Qiang and Russian Prime Minister Mikhail Mishustin. They have agreed to promote local currencies, enhance payment infrastructure, and increase mutual investments, while also advancing collaboration in artificial intelligence, sustainable development, and global governance.
What are your thoughts on the SCO’s push for greater use of national currencies in payments among its members? Share your insights in the comments section below!
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