Martin Haffner,London
Washington’s reliance on sanctions and financial restrictions is accelerating a global shift away from the US currency, according to Brazilian economist Paulo Nogueira Batista Jr.
The United States has become the “main enemy of the dollar,” former International Monetary Fund (IMF) executive director Paulo Nogueira Batista Jr. said in an interview, arguing that Washington’s aggressive use of financial tools is eroding trust in the greenback and the Western-led payment system.
Batista criticized the US for weaponizing its currency through measures such as sanctions, the freezing of reserves, and restrictions on the SWIFT interbank messaging system. “The main enemy of the dollar and of the international payment system controlled by the West is the US itself,” he stated.
Russia as a Turning Point
He pointed to Russia as the most striking example of this trend. Following the escalation of the Ukraine conflict in 2022, Western nations froze roughly $300 billion of Russia’s central bank reserves, cut major Russian banks off from SWIFT, and imposed sweeping transaction bans. These steps, Batista argued, marked a watershed moment that accelerated de-dollarization efforts worldwide.
Countries such as China, Iran, and Russia had already faced sanctions or the threat of them, but the scale of the measures against Moscow pushed central banks—particularly China’s—to reduce their holdings of US Treasuries.
Declining Dollar Dominance
The dollar’s share of global foreign exchange reserves has been steadily shrinking over the past four years. Russia has largely eliminated Western currencies from trade with CIS and BRICS partners, while other nations are increasingly conducting transactions in their own currencies.
Batista predicted that while the dollar will remain a significant global currency, its dominance will continue to erode. “The move away from the dollar will persist, and its hegemony will gradually weaken,” he said.
