Speeding up “de-dollarization”

News on August 13. Russia is resolutely implementing “de-dollarization.” Data shows that Russia now receives more euros than US dollars in export settlement to China.

In August, the Central Bank of Russia released data showing that slightly more than 50% of China’s imports from the country in the first quarter were valued in euros, and only 46% of settlements were in US dollars. In addition, the proportion of Russian exports to the EU settled in euros has increased from 38% at the end of last year to 43%. This transformation is part of the “de-dollarization” strategy of the Russian economy, which aims to reduce the vulnerability of the Russian economy under the threat of US sanctions.

IMF: Watch out for debt crises
The International Monetary Fund (IMF) recently stated that the new crown pneumonia epidemic may further narrow the global current account imbalance and warned that a new large-scale outbreak of the epidemic may increase the risk of foreign debt crises in emerging economies and developing countries.

The IMF said that with the slowdown in trade growth, the new crown pneumonia epidemic may further narrow the global current account imbalance in 2020, but some commodity exporting countries and countries that rely on tourism will turn to current account deficits; if the epidemic breaks again, It will bring new pressure to the financial market and may plunge countries that are already in a huge current account deficit and high foreign currency debt into crisis.

France: Promote wearing masks
In response to the rebound of the epidemic, the French government stated on August 18 that it plans to promote the use of masks in some workplaces. French Minister of Labor and Social Affairs Elizabeth Borne said in a video conference with employers and union representatives that the government believes it is necessary to promote wearing masks in some workplaces. For example, in meeting rooms, open office areas, and walkways without natural ventilation, employees must wear masks.

Bornet cited the view of the French High Commission for Public Health that the new crown pneumonia virus can be transmitted through aerosols, so wearing a mask is an important measure of personal protection.

Vietnam: Rice export prices rise to high
News on August 18. According to data from the Vietnam Food Association, the price of rice in Vietnam has been rising since mid-July, surpassing Thailand, and some types of rice export products have reached the highest prices in the world.

The trading price of 5% of broken rice in Vietnam is US$493-497 per ton, and similar products in Thailand are US$473-477. According to industry insiders in Vietnam, the export price of some Vietnamese rice is now higher than Thailand, for the first time in nearly 30 years. The EU-Vietnam Free Trade Agreement (EVFTA) has created favorable conditions for Vietnamese rice exports; according to EVFTA, Vietnam has a quota of 80,000 tons of shelled fragrant rice each year to enjoy zero export tariffs.

Germany: Persist in the construction of “Beixi 2”
On August 16, local time, Klaus Ernst, Chairman of the Economic and Energy Committee of the German Bundestag, publicly stated that Germany was discussing to sue the United Nations for the threat of US sanctions on the “North Stream 2” natural gas pipeline project.

Once Germany puts this motion into effect, the confrontation between the United States and Europe surrounding the “North Stream 2” will rise to an international event, which is bound to have a huge impact on the transatlantic alliance. Once the “North Stream 2” project is completed, Russia’s natural gas supply to Europe will double, and many European companies have participated in this project that allows Europe to obtain cheap natural gas.

United Kingdom: The economy is in a severe recession
On August 18, local time, Marks & Spencer announced that it plans to lay off 7,000 employees in the next three months to streamline its business and prepare for sales in the post-epidemic era. After the outbreak, British companies announced plans to lay off workers. In June alone, 1778 companies expressed their intention to lay off workers, involving more than 139,000 people.

According to data from the National Bureau of Statistics of the United Kingdom, in the second quarter of this year, Britain’s gross domestic product (GDP) shrank by 20.4% month-on-month, the most severe situation since records began in 1955. In the G7, the UK’s economic report in the second quarter was worse than that of the US, France, Germany, and Italy.

Brazil: Agricultural exports continue to be strong
According to recent statistics from the Brazilian Ministry of Agriculture, in July, Brazilian agricultural exports reached US$10 billion, a year-on-year increase of 11.7%, accounting for 51.2% of exports in July. Among them, soybean exports were US$3.61 billion, reaching 10.4 million tons; sugar exports were US$964 million, a year-on-year increase of 83.4%; agricultural exports to China were US$3.85 billion, a year-on-year increase of 34.3%.

In the first half of this year, Brazil’s export of agricultural products was US$51.63 billion, an increase of nearly 10% compared with US$47.08 billion in the same period last year. The increase in exports was mainly due to the strong growth in exports to China. The Organization for Economic Cooperation and Development (OECD) pointed out that Brazil will continue to increase its share in the world’s agricultural trade.

New Zealand: The economy faces a deep downturn
The New Zealand Herald reported on August 19 that the international economic research agency Fitch Solutions reported that the New Zealand economy will face a difficult period for the rest of this year. Fitch lowered its forecast for New Zealand’s GDP growth in 2020 from -1.4% to -4.5%, but it expects a strong recovery in the country in 2021.

Fitch said that New Zealand’s economic recovery in 2021 will be attributed to the combined effects of a variety of external factors, especially the recovery of China’s economic growth trend and the recovery and growth of suppressed domestic demand in China.