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Background
The governor of the Central Bank of Pakistan, as the former chairman, handed over the presidency to the governor of the Iranian central bank, Mohammad Reza Farzin. Jameel Ahmad said the union can come up with new ideas for alternative currencies that would bring more benefits. Farzin, for his part, expressed hope for more cooperation between the ACU members (ACU = Asian Clearing Union).
The Governor of the Central Bank of Iran (CBI) has underlined the need for the member states of the Asian Clearing Union (ACU) to trade in their national currencies and other not commonly used currencies.
The CBI governor said that the ACU was established in 1974 with the aim of de-dollarization and using local currencies and fostering barter trade among the nine member countries: Bangladesh, Bhutan, India, Iran, Maldives, Myanmar, Nepal, Pakistan, Sri Lanka.
The Vice president of Iran and top banking officials of the member states have attended the meeting. The Asian Clearing Union, that has 9 members, was established in 1974 with the aim of reducing dependence on global currencies, especially the US-dollar. The main objective of the union is to facilitate payments among member countries for eligible transactions.
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PressTV: Could you please comment on dedollarization, Iran’s capability of evading US sanctions?
Peter Koenig: Although in existence since 1974, the Asian Clearing Union (ACU) has hardly been on the radar of the west in at least almost 50 years. Of course, it is not convenient for the west to show the world that an alternative to the western-controlled SWIFT international transfer system is possible.
Definitely – a strengthened and even enlarged ACU would help Iran and all adhering members to dedollarize.
Dedollarization has already made enormous headways. At present international reserves consist only of a mere 45% of US dollar denominated assets.
Some 20 years ago, 90% or more of all reserves were designated in US dollars. Likewise with trading. Once upon a time, still 10-15 years ago, the US dollar was the main trading currency in the world. No more.
There has been a gradual shift away from trading in US dollars, and instead countries adopted trading in their local currencies, or in a currency of common use by the trading partners, for example the Chinese Yuan.
Latin America – especially Argentina, Brazil, Mexico, Venezuela – are consistently using local currencies or the Chinese Yuan to avoid the dollar.
Avoiding the dollar is foremost for own protection from US sanctions. Increasingly more country will use this new mode of trading – equitable and peaceful.
PressTV: What about the New World Order?
PK: The New World Order as foreseen by the Great Reset and UN Agenda 2030 is a pipe dream of the west.
It will not happen – as too many countries see through the game and will object, and start creating new alliances as we see already emerging in the east, in the form of the enlarged BRICS+ (Iran), as well as in monetary / exchange terms with the Asian Clearing Union.
These may evolve into parallel economies – eventually leaving the west behind.
Let us not forget, the Global South is part of the Eastern Alliance – and most of the natural resources left on the planet are in the East – Russia is a good example – and in Africa and Latin America.
The west will starve without the resources of the Global South.
Important question but we cannot prove it: Are man-made climate change – ENMOD technologies (Environmental Modification) — causing extreme crop and infrastructure damage, by floods and droughts, cold and heat waves, even causing earthquakes? It all goes under the indoctrinated narrative of “climate change”.
Most people on planet earth have no clue about the truth. They have been brainwashed with a criminal lie for the last at least 30 years. It is now difficult to convince them of the truth.
Eastern Alliances – and a coordination mechanism, or union, like the Shanghai Cooperation Organization (SCO) – will make the East, eastern or alternative economies independent.
After all the East and Global South comprise more than two-thirds of the world population and already now, in its limited form, close to 40% of the world’s GDP.
PressTV: Can you, please, comment on the capacity of Iran’s economy in the region and the world?
PK: Under the new premises of an enhanced ACU, the Iranian economy may expand exponentially – even more so, if the member countries expand and create a common trading / reserve currency like an Asian SDR = ASDR. In this case they would be way ahead of the west.
PressTV: What do you mean by an Asian SDR (Special Drawing Right)?
PK: As mentioned earlier, until recently little was known to the rest of the world about the 1974 created Asian Clearing Union. It is now the moment to activate ACU, expand it, making it a reliable platform for trade and monetary transfers, a force to outmaneuver SWIFT – for eastern alliances, for trading.
In short, ACU should become a fully non-SWIFT trading / money-transfer platform for further dedollarization, as well as for lending eastern economies stability – independence from the western dollar-dominated, sanction-prone SWIFT system.
If possible, more countries may join with “stronger” currencies – China, Russia, and why not ALL BRICS — perhaps ACU may also partner with the Shanghai Cooperation Organization (SCO) to build up strength.
If I may, let me advance an idea – the currencies of participating ACU countries could be grouped into some kind of Asian SDR where each currency within the Asian SDR – ASDR – would be weighed according to its own economy, and the ASDR could act as a trading currency – as well as a reserve currency for participating as well as non-participating countries.
This concept, at one point, was behind the IMF established Special Drawing Right (SDR) which today consists of the world’s five major currencies – US-dollar, Chinese Yuan, Euro, British Pound and Japanese Yen. They figure within the IMF-SDR with their weighted average according to their country’s economic strength.
However, the SDR has major flaws. The IMF being dominated by the US, the Chinese Yuan is considerably undervalued. Every discussion and argument China wants to engage in with the IMF / US for adjusting the Yuan’s weight within the SDR is being “avoided”.
Therefore, an Asian SDR (ASDR) – could be named differently, applying the principles of the IMF SDR — would be a tremendous step towards dedollarization, towards independence from the western currencies.
ASDRs might not only be used for trading but also as a reserve currency. The more countries join the ACU / ASDR system, the stronger the ASDR, the more pressure to dedollarize the world.
It would allow escaping the “sanctions regime” of the US and Europe and lead into a new more balanced monetary system.
As this new exchange-trade progresses, more countries – even from the so-called west — may join.
A more balanced monetary / economic system – a better equilibrium of the world economy — is a natural precursor for PEACE.
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Peter Koenig is a geopolitical analyst and a former Senior Economist at the World Bank and the World Health Organization (WHO), where he worked for over 30 years around the world. He lectures at universities in the US, Europe and South America. He writes regularly for online journals and is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed; and co-author of Cynthia McKinney’s book “When China Sneezes:Clarity Press – November 1, 2020).
Peter is a Research Associate of the Centre for Research on Globalization (CRG). He is also a non-resident Senior Fellow of the Chongyang Institute of Renmin University, Beijing.
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