It is well-known that the United States' interference and threats to other countries, apart from the direct deterrent of military hegemony, have the deepest impact on a country's foundation through the absolute hegemonic status of the US dollar in harvesting the wealth of other nations. However, the United States' trump card has proven to be ineffective against China. On the contrary, in response to China, the trend of global de-dollarization has intensified, with the Asian Infrastructure Investment Bank (AIIB) playing a crucial role in this process.

The Internationalization of the Renminbi

In recent years, the United States has been leveraging the hegemonic status of the US dollar to reap the world's wealth. It influences the global financial market landscape through methods such as printing money, raising and lowering interest rates. For instance, during the Asian financial crisis in the 1990s, the US dollar's interest rate hikes led to a massive influx of capital from Southeast Asian countries into the United States, while these countries suffered severe economic crises.

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Moreover, during periods of geopolitical tension, the United States also uses the hegemony of the US dollar to deliver fatal blows to other nations. For example, during tense relations with Russia and Iran, the United States severed Russia's connection to the US dollar, froze Russian and Iranian assets in the United States, and even excluded Russia from the SWIFT system.

The restrictions and sanctions imposed on these countries are all strong assertions of the US dollar's hegemony. Of course, such actions by the United States have also provoked the aversion of countries worldwide, leading many to explore paths towards de-dollarization. For instance, Russia encourages businesses and individuals to use other currencies, such as the renminbi, in foreign trade, with the renminbi accounting for an astonishing 99.6% of Russia's foreign exchange market.

The government of Zambia restricts the use of foreign currencies, especially the US dollar, in local trade; Venezuela has also expressed its intention to reduce the use of the US dollar in foreign trade and increase the use of renminbi settlements.

Some African countries, such as South Africa and Egypt, have followed suit by reducing their use of the US dollar and encouraging the use of the renminbi as a settlement method. It is evident that the renminbi plays a significant role in the path towards de-dollarization. Why is this the case?

This brings us to the AIIB, which primarily invests in the infrastructure development of Asian countries. It is also necessary to mention the Belt and Road Initiative, both of which were initially proposed by China. Their primary purpose is to serve China's development, and China has always emphasized the philosophy of "harmony in unity, sharing beauty, and a world of great harmony."

Therefore, mutual benefit and win-win cooperation with other countries align with our development direction. The AIIB provides member countries with funding, technology, and experience for their infrastructure construction, such as the Jakarta-Bandung High-Speed Railway project in Indonesia and the M4 Highway project in Pakistan. These projects contribute to promoting regional interconnectivity and economic integration.Having said so much, what is the relationship between the AIIB (Asian Infrastructure Investment Bank) and de-dollarization?

The infrastructure of member countries requires financing. When they lack funds and technology, they need to borrow from the AIIB. They borrow in yuan, which is used as loans, and during the construction and implementation of projects, the borrowed yuan flows back to China. As a result, these member countries have claims denominated in yuan.

Moreover, during the investment and construction process, China exports machinery and equipment and its domestic excess capacity, which allows both economies to grow rapidly, and member countries also increase their dependence on the yuan.

There are particularly many such countries in Africa, and this can be attributed to the assistance to Africa under the Belt and Road Initiative. Consequently, many African countries have gradually reduced their use of the US dollar, and the influence of the yuan in Africa is also increasing, making the international status of the yuan higher and higher.

Can de-dollarization be achieved?

When the United States expelled an oil-producing country that settled in US dollars from the dollar trading system, it should have anticipated the intensifying trend of global de-dollarization.

In both traditional Chinese philosophy and Marxist philosophy, the wisdom of "extremes meet" has been mentioned, which means that the extreme dominance of the US dollar will inevitably be counterattacked. Can the global wave of de-dollarization really reach the level of stormy waves?

The European Union once introduced the euro, hoping to use its international influence to achieve de-dollarization. However, the gap between Europe and the United States in various aspects is not enough to shake the hegemony of the US dollar.

But now it's different. BRICS countries, including China, Russia, and Brazil, mostly support de-dollarization, which has given rise to the BRICS payment system. Once it is successfully launched, many member countries with international influence can directly bypass the US dollar for settlement.

Among these countries, there is China, known as the world's factory, which the world cannot do without. This also means that the world will gradually become inseparable from the yuan system built by industry.Russia is an extreme needer of the BRICS payment system. Firstly, it has been expelled from the US dollar settlement system, and under the sanctions and blockade of the United States, its sluggish economy urgently needs an opportunity to recover. Secondly, Russia is one of the most important oil and natural gas powers in the world, and it has absolute reliance in terms of resources.

As for some small countries, their willingness must also be very strong. Because every interest rate hike and cut by the Federal Reserve will have a devastating impact on the economies of other countries, especially those with a single economic structure.

Therefore, for the vast majority of countries in the world, de-dollarization has become a common desire, and the trend of de-dollarization is becoming more and more intense. However, the realization of de-dollarization still needs to wait, waiting for us to become stronger, waiting for the US dollar to be increasingly abandoned.