A defiant Putin renewed calls for countries to trade with Russia using local currencies in his first international appearance after the failed Wagner mutiny

• Vladimir Putin has touted the use of local currencies — instead of the dollar —for trade.
• At a trade summit, Putin said 80% of the Russia-China trade is now transacted in the yuan and the ruble.
• It was Putin’s first international appearance since a failed mutiny in Russia two weeks ago.

Russia has again touted the use of local currencies for trade — instead of the US dollar — as the country continues to face sweeping sanctions over the Ukraine war.

On Tuesday, while speaking at a summit, President Vladimir Putin highlighted Russia’s trade with China, which he said is now primarily settled in the Chinese yuan and ruble.

This was Putin’s first appearance at an international event after a failed mutiny by the Wagner mercenary group two weeks ago. 

“Over 80 percent of commercial transactions between Russia and the People’s Republic of China are made in rubles and yuan,” Putin said, according to an official English transcript of his speech at the annual meeting of the Shanghai Cooperation Organization, or SCO — an intergovernmental organization seen as an alternative to Western-led groupings. India hosted the virtual summit.

The yuan surpassed the dollar as the most used currency for Chinese cross-border transactions in March this year, per a Reuters calculation of official Chinese data.

The Russian currency was used in 40% of all export transactions with SCO countries, Putin added. Founded in 2001, SCO member countries include China, Russia, India, Pakistan, Kazakhstan, the Kyrgyz Republic, Tajikistan, Uzbekistan, and Iran.

“I would like to stress that Russia is confidently resisting and will continue to resist external pressure, sanctions, and provocations,” Putin said at the summit.

Putin’s push to move away from the greenback follows sweeping sanctions against Russia that have expelled the country from the US dollar-dominated global financial system.

The dollar has been the world’s reserve currency since the Second World War, playing a crucial role in the world’s trade. The tough restrictions against Russia spooked other countries so much that they are now lining up backup currencies for trade. 

This de-dollarization play suits China, which has been trying to increase the global circulation of the yuan. Sanctioned countries like Russia and emerging nations like Argentina have recently started using the yuan for trade, primarily with China.

Chinese President Xi Jinping also proposed to expand the use of local currencies for trade among countries in the SCO, according to an official transcript of his speech at the summit.

Xi said China stands ready to work with all sides, moving toward “the right direction of economic globalization, oppose protectionism, unilateral sanctions and the overstretching of national security, and reject the moves of setting up barriers, decoupling and severing supply chains,” according to an English translation of his speech carried by state broadcaster CGTN.