When money becomes a weapon

Along with the development of economic cooperation relationships, trade and financial transactions between many countries and on the whole world, currency has also become the object of politicization and become. into the political weapon of the country or the organization that owns the money.

America has done so with the world dollar. France did so with the Franc in Africa. The EU has done so with the Euro in Europe. And China now wants to do the same with the world yuan.

It is not unreasonable or impartial that America more than 70 years ago sought to build the Bretton Woods System to help the dollar gain the position, role and influence of the unofficial main currency in the world. Also, for the sake of many other political and strategic interests, many countries seek to expand the use of their currencies and gradually reduce the use of other currencies.

EU with Euro. China with the Yuan through international monetary cooperation, especially bilateral currency swaps, in financial institutions, newly established banks as joint bank of the BRICS group, Development Bank Asian infrastructure ...

That is why the world has never disappeared from obsession with the risk of a currency war. Not only China but also a few other countries want to depress the dollar and have taken the first steps. The position of the USD is decreasing but it will certainly take a long time before the Chinese Yuan or any other currency can push the USD out of its current position and replace it.

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Currency is one of the most obvious manifestations of a nation's economic strength and socio-political stability. Once a country gains the influence, role and impact of its currency in another country, for example through currency cooperation, it also means that the country is in possession. a weapon both politically, not merely economic.

Bilateral currency swaps have positive effects on trade in particular and economic cooperation in general, but the indispensable accompanying conditions is that the bilateral political relationship must be really good and reliable. , the size of the two countries' economies is not too different, the trade balance and bilateral payments are not too inclined to one side and the currency swap is not infinite.

In other words, the degree of swap must be within a certain limit and within the control of a weaker party in terms of economic potential and smaller in size of the economy. This is especially important when one of the two currencies involved in a currency swap does not yet have free conversion capabilities - like the current Chinese Yuan.

Therefore, all forms and degrees of international cooperation and integration need to be seen firstly from a political perspective to eliminate the risks and risks of monetary cooperation being used for benefit from the very beginning. political benefits.