De-dollarization in Africa: could BRICS currencies challenge greenback?

A recent report by Sputnik Africa claiming that the use of the Russian ruble for trade between Russia and Africa has more than doubled since 2022 is challenged by other sources that report a sharp dip in the share of ruble payments from 23.7% in mid-2022 to 12.7% in mid-2023.

Russian ruble usage in international trade sees a significant uptick, particularly in African nations, whereby this shift is likely to reduce reliance on the US dollar, according to a report by Sputnik Africa. It also claims that the use of the Russian currency for trade between Russia and Africa has more than doubled, from 21.9% in 2022 to 48.1% in 2023. To support these claims, the report also refers to the Russian Central Bank’s data that should also indicate a substantial rise in the amount of ruble settlements in other regions outside of Africa including with American countries.

But this report is disputed by the Russian business newspaper RBC that has recently published an article about African countries turning away from the Russian currency to pay for goods they import from Russia, using the Chinese currency, yuan, instead. It based its conclusion also on the Russian central bank statistics that shows that the share of ruble payments tumbled from 23.7% in July 2022 to 12.7% in July 2023. The RBC report added that African companies prefer to use yuan in search of flexibility, stability and safety.

In any case, “as the BRICS bloc expands, efforts by BRICS policymakers to increase global use of non-dollar currencies — particularly the Chinese renminbi — are accelerating,” a recent analysis published by Carnegie Endowment for International Peace concluded.