As US economic clout diminishes, China and Europe work to cut dollar reliance
- The European Union is aiming to boost the role of the euro in international settlements, making it less dependent on the US dollar system
- With US economic dominance in slow decline, Europe like China is trying to strengthen its position in a multipolar world, analysts say
The European Union’s initiative to cut its reliance on the US dollar is the latest show of scepticism towards American efforts to rebuild multilateralism amid the emergence of new regional powers such as China, analysts said.
European market players should cut their use of clearing houses outside the EU and increasingly work with those based inside the 27-nation bloc, it said.
The EU appears to be signalling to the new US administration – which began its term with Joe Biden’s inauguration on Wednesday – its view on the inevitability of a multipolar world, putting the president’s goal of a “return to multilateralism” very much in doubt, analysts said.
What seems to be happening is that regardless of who occupies the White House, we are living in a more polycentric world
“What seems to be happening is that regardless of who occupies the White House, we are living in a more polycentric world,” said Juscelino Colares, a professor of business law and political science at Case Western Reserve University in Ohio.