Last month, several Japanese banks took the unprecedented step in bypassing SWIFT and the dollar by connecting directly to China's CIPS platform for interbank settlement. Now on March 9, Russia is following suit as one of their largest banks announced today that they are officially connecting to CIPS to conduct their own interback settlement with China that will no longer require intervention with the global reserve currency.
Russia's VTB Bank has been successfully connected to Chinese-based Cross-Border Inter-Bank Payments System (CIPS), the bank said on Wednesday.
"VTB has been linked up to the system via correspondent banks and has successfully completed test operations in late 2015. We are monitoring the development of the introduction of the next phase of the CIPS, which is supposed to increase the operational efficiency of transactions," VTB's press office said in a statement. - Sputnik News
As more and more nations find direct bi-lateral trade a better and more equitable way of conducting commerce between economies, the less need there will be for countries to have to buy dollars to function in antiquated trade models. And at the leading edge of this is China, who through coalitions such as the Shanghai Cooperation Organization and Silk Road projects are steadily expanding the idea of direct trade, and in the natural currencies held by each respective partner.
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