Clock ticking on US financial hegemony – senior Russian MP

Mounting debt and a reliance on sanctions have jeopardized US credibility as an economic partner and may soon shatter its image as a global financial power, Anatoly Aksakov, the head of the Duma’s Financial Market Committee, told the Izvestia news outlet at the St. Petersburg International Economic Forum (SPIEF) on Thursday.

According to the senior lawmaker, the US share in global trade turnover is rapidly dropping, a trend likely to continue in the coming years.

“We see that the US share in world trade has shrunk to about 70%, in part due to sanctions against Russia which undermined confidence in the US currency.

“Previously, 70% of international trade was serviced by the dollar, now it is 60%. Can you imagine, 10% in just a short period of time – this is significant. Naturally, this process will continue, because the US undermines partners’ trust with their actions. So, of course, not in one or two years, but in ten years, America as a great financial power will cease to exist,” Aksakov stated.

He noted that apart from the flaws in its foreign policy, the US has been plagued by problems due to its economic policies at home.

“The US can one of these days let everyone down, because effectively it cannot pay its debts. The gross domestic product it produces is less than the debts it accumulates [and] whatever the country earns will not be enough to pay its debts. Meanwhile, the US keeps borrowing all over the world and pays out by building up domestic debt. So eventually, there will come a time when there will be so much debt that it will become impossible to fulfill obligations. And then [the US economy] will collapse,” Aksakov warns.

The US narrowly avoided its first-ever debt default earlier this month when President Joe Biden signed a bill that suspended the limit on Washington’s $31.4 trillion in debt until January 1, 2025. This means that the US government can continue to pay for services at home, such as social security and Medicare, by borrowing money abroad and effectively amassing even more debt.

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