China-Russia trade is conducted in local currencies at a rate of 99%, and the international payment role of the Chinese yuan is severely underestimated.

99% of Sino-Russian trade does not use U.S. dollars!

U.S.-China trade surplus shrinking, RMB's international payment role severely underestimated

A noteworthy feature of Sino-Russian bilateral trade: the vast majority of transactions are settled in local currencies rather than U.S. dollars. When China purchases goods from Russia, payments are made in rubles or renminbi; similarly, when Russia buys Chinese goods, it also uses renminbi for payment.

Currently, the proportion of local currency settlement in Sino-Russian bilateral trade has reached 99.1%. In other words, in this over $220 billion in bilateral trade volume, the vast majority of transactions do not involve U.S. dollars.

However, it is worth noting that Sino-Russian trade is growing rapidly, but structurally, Russia exports significantly more than China does, resulting in a trade deficit for China with Russia of around $20 billion.

The reason lies in Russia’s population of over 100 million and relatively low consumption levels, which naturally limits the scale of China’s exports to Russia.

Meanwhile, as the world’s largest energy importer, China imports enormous quantities of oil and natural gas, leading to a substantial trade surplus for Russia vis-à-vis China.

In contrast, the situation between China and the United States is exactly opposite. Bilateral trade between China and the U.S. totals approximately $500–600 billion, a massive scale, yet China’s trade surplus with the U.S. has been declining year by year.

During Trump’s first term, China’s trade surplus with the U.S. (i.e., the amount by which China exported more) peaked at around $400 billion, but this figure has now dropped to about $200 billion.

It should be emphasized that all trade between China and the U.S. is settled in U.S. dollars. The reason for highlighting this point is that many people often cite the statistic that "the share of renminbi in international trade payments is about 3%."

This data comes from SWIFT system statistics, which primarily reflects information sources under U.S. control.

But in reality, bilateral local currency settlement transactions conducted by China with Russia, Brazil, Australia, and other countries fall outside the scope of SWIFT payment system statistics.

Original source: toutiao.com/article/1866155239536777/

Disclaimer: The views expressed in this article are solely those of the author.