Reference News Network November 24 report: The U.S. Foreign Policy website published on November 14 an article by Yerlan Nuriev, a senior researcher at the Alexander von Humboldt Foundation in Germany, titled "How Asia is Coping with the Weakening of U.S. Financial Control." Excerpts follow:

For decades, the global order has been based on a simple premise: the United States dominated the system with its economic and military superiority, and other countries could only adjust and adapt. From the Bretton Woods system to the unipolar era after the Cold War, Washington remained the center of the global economic and security architecture.

This model is now under pressure. The United States continues to dominate global financial channels: the dollar accounts for about 58% of global official foreign exchange reserves, about half of global trade, and more than 40% of cross-border debt issuance. Dollar liquidity still dictates the rhythm of global markets. Many countries rely on the dollar in trade and foreign exchange reserves.

However, this financial hegemony can no longer be converted into political alliances. The hope that economic globalization and U.S. leadership would complement each other has faded. Globalization has not collapsed; it has simply become more diversified. The system once centered on the United States has transformed into a network of multiple regions and functions intertwined.

In Asia, the logic of "multilateral alliances" is taking root. China has established parallel financial and connectivity infrastructure through initiatives such as the Belt and Road Initiative, the Asian Infrastructure Investment Bank, and regional digital platforms challenging Western models. India, Gulf countries, and most Southeast Asian countries are hedging their bets: maintaining security relations with Washington while deepening trade, energy, and technology ties with Beijing and Moscow. Even U.S. allies like Japan and South Korea are exploring limited autonomy through regional financial cooperation and currency settlement mechanisms.

This model reflects a deeper shift: countries now see the U.S. financial lever as both indispensable and risky. Dependence on the dollar still exists, but it has become a strategic consideration rather than an automatic choice.

The political purposes of mechanisms such as China's Cross-Border Interbank Payment System (CIPS), India's rupee-based trade arrangements, and the alternative settlement mechanisms proposed by the BRICS are clear: to create multiple options outside the dollar.

Washington has used the financial system as a tool of governance, strengthening the influence of the dollar while exposing its own vulnerabilities. The comprehensive sanctions imposed on Russia following its special military operation in Ukraine demonstrated U.S. financial power, but also revealed the risks of reliance on the dollar. The dollar, once a source of stability, is increasingly seen as a potential risk.

This paradox defines this new era: the world still relies on the dollar, but does not accept the hierarchy it implies.

The United States can still constrain competitors through the liquidity, regulation, and market access of the dollar, but it can no longer assume these tools will lead to political alliances. Even America's close allies are making adjustments: the EU is countering U.S. industrial policies, the Gulf region is balancing between Washington and Beijing, and ASEAN's neutral diplomacy all point in the same direction.

For U.S. policymakers, the challenge is not the immediate collapse of the dollar's status, but how to make strategic adjustments. Continuing to rely on the dollar's central financial position instead of political leadership may lead to complacency. The U.S.'s enduring advantages, such as deep capital markets, rule of law, and innovation, still make the dollar indispensable. But the legitimacy of this dominance depends on how the U.S. uses it. A system based primarily on coercion cannot satisfy all parties forever.

In the emerging Asian-centered global economy, the stability provided by hierarchies will gradually decrease, and more stability will come from interdependence. If Washington can play a leadership role through credible institutions and cooperation, it will still be in the best position to shape this framework.

The next phase of globalization may involve a coexistence of financial gravity and strategic fragmentation. The dollar will still be the world's currency, but not necessarily the world's consensus.

If the U.S. adjusts according to this reality, it can still play a stabilizing role in an increasingly diverse world. Otherwise, the system that the U.S. created will no longer depend on U.S. leadership. (Translated by Pan Xiaoyan)

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