According to Johnston, the first proposal for a “neutral reserve asset,” based on productive power and commodities, to reform or replace the dollar system of US dominance was a March 2009 paper titled “Reform the International Monetary System” by People’s Bank of China (PBOC) Governor Zhou Xiaochuan. Since the U.S. Treasury’s monster sanctions on Russia on February 24, 2022, the China-Russia-India-Southeast Asia reorientation of oil trade has created a “petro-yuan,” he claims, not in buying oil from Saudi Arabia, but from Russia—and even India has made some purchases in yuan, among much larger ones in rupee and UAE dirham. Saudi Arabia and China have been conducting large-scale currency swaps since November 2023, paving the way for Saudi Arabia to participate in these arrangements, whether or not it has done so. According to Johnston, speculations regarding the Saudi-US deal “expiring” could just be an encouragement to extend the yuan trade in oil products in exchange for China’s high-technology capital goods.
Johnston makes no mention of the United States Treasury’s secondary sanctions imposed on Chinese and foreign banks and firms who conduct business with Russia on June 12, 2024. The escalated “embargo” attempt resulted in the yuan-ruble currency exchange rate becoming Russia’s benchmark for all other currencies, including the dollar. Since then, there has been constant pressure—no doubt initiated by the US Treasury—to drive the yuan below its months-long stable value of 12 rubles. Moscow and Beijing, however, have maintained that “peg”.
