A government meeting to support the dinar and address manipulation and speculation
China’s yuan expands its growing foothold in South America as Bolivia reduces reliance on US dollar
Jul 31, 2023, 2:09 PM EDT
China’s yuan is expanding its foothold in South America as Bolivia reduces its reliance on the dollar.
The country’s yuan transactions from May to July accounted for about 10% of its foreign trade in that span.
Bolivia has been hit by dollar shortages recently as lower natural gas production hit exports.
Bolivia is reducing its reliance on the US dollar and turning to the yuan, marking the latest sign that China’s currency is expanding its growing foothold in South America.
The country made financial transactions totaling 278 million Chinese yuan ($39 million) from May through July, or about 10% of its foreign trade in that span, Bolivia’s economy minister said Thursday.
“We’re already using the yuan. It’s a reality and a good start,” Marcelo Montenegro said at a news conference, according to the Associated Press. “Banana, zinc, and wood manufacturing exporters are conducting transactions in yuan, as well as importers of vehicles and capital goods.”
He later added, “The amount being used in yuan is still relatively small, but it will increase over time.”
Bolivia’s currency, the boliviano, is pegged to the dollar. But the country has been hit by dollar shortages recently as lower natural gas production hit exports.
As its foreign exchange reserves shrink, the government’s ability to defend the dollar peg has come under pressure.
Bolivia joins South America’s two biggest economies, Argentina and Brazil, in tilting toward the yuan and away from the dollar.
In April, Argentina said it will start buying the bulk of its Chinese imports in yuan instead of dollars, as it seeks to preserve its shrinking supply of greenbacks.
Argentine companies are increasingly turning to China’s yuan amid dollar shortages, though many consumers use the dollar in daily purchases as hyperinflation slams the peso.
And in February, Brazil agreed to using the yuan in cross-border transactions with China. And Brazilian President Luiz Inácio Lula da Silva has urged developing nations to find an alternative currency to the dollar, denouncing the central role of the greenback in global trade.
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Iraqi judges, security leaders convene to tackle currency manipulation
According to a statement by the Supreme Judicial Council, the meeting was attended by the Chief Prosecutor, the Chairman of the Judicial Supervision Authority, the top investigating judges from the second and third investigation courts in Al-Karkh, and the investigation court in Al-Rusafa, which handles integrity and economic crime cases. Additionally, the meeting included the head of the National Security Apparatus and the Deputy Minister of Interior for Intelligence Affairs.
During the meeting, they discussed the best ways and mechanisms to address the phenomenon of currency manipulation, particularly concerning the value of the Iraqi dinar against the US dollar, aiming to curb such practices and prosecute those involved in accordance with existing laws, as stated in the statement.
Today, Monday, the Supreme Judicial Council announced the arrest of suspects involved in suspicious financial activities.
The suspects admitted to setting up business companies as a cover for smuggling currency out of Iraq. These companies were raided in various areas of Baghdad, resulting in the confiscation of approximately fifteen million dollars. The seized funds were subsequently deposited with the Central Bank, after the Anti-Money Laundering Office submitted reports indicating suspicions of money laundering through monopolizing the dollar in this manner.
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