"US Dollar very important but, Weaponizing it is strategic error!" - Putin

KAZAN, Russia

Russian President Vladimir Putin has sharply criticized the use of the US dollar as a political weapon, describing it as a “big mistake” that could undermine global confidence in the currency.

Speaking at the BRICS Summit in Moscow, Putin warned that such practices not only damage international trust in the dollar but could lead to long-term instability in global financial markets.

The Russian leader’s comments come amid increasing concerns about the US dollar’s dominance in international trade and finance, which has been leveraged by the US government to impose economic sanctions on countries like Russia and Iran.

In recent years, Washington has used its control over the global financial system to block access to dollar-based transactions, a move Putin argues is counterproductive.

“The weaponization of the dollar in political disputes is a mistake of significant proportions,” Putin said. “By using the dollar as a tool for imposing sanctions and restrictions, the United States is undermining its own currency and eroding trust in its role as the global reserve currency.”

Despite these criticisms, Putin made it clear that Russia has no intention of entirely rejecting the US dollar. He emphasized that the currency remains an essential part of international trade and finance.

However, he noted that Russia and other countries under similar pressure must consider alternatives if they face continued restrictions. “We are not rejecting the dollar, but we need to think about other options if these restrictions continue,” Putin added.

In recent years, Russia has made efforts to reduce its reliance on the dollar by increasing trade in other currencies, including the Chinese yuan and the euro.

Moscow has also boosted its gold reserves and explored the possibility of using digital currencies and blockchain technology in international transactions. The move is part of a broader strategy aimed at reducing vulnerability to US-led sanctions and creating a more multipolar global economy.

Putin also stressed the importance of transitioning to what he called a “fairer economic system” that does not rely on “someone else’s rules and platforms.”

According to the Russian president, the existing financial order, dominated by Western institutions such as the International Monetary Fund (IMF) and the World Bank, has perpetuated inequalities and contributed to instability, particularly in developing countries.

“The faster we can move away from platforms and rules imposed by others, the sooner we can stabilize the global economy,” Putin said.

He further warned that continuing to depend on the US-led financial system could extend the current period of global economic turbulence, which has been exacerbated by conflicts such as the ongoing war in the Middle East.

Putin’s remarks also come amid rising tensions in the Middle East, where a renewed escalation of violence has threatened oil supplies and global markets. He argued that over-reliance on the US dollar and Western financial systems has made countries more vulnerable to external shocks.

“We are seeing the consequences of this flawed system in the turbulence of the global economy today,” he stated, referencing the economic fallout from the conflicts.

Moscow has increasingly aligned itself with other countries seeking to diminish the US dollar’s influence in global trade. The BRICS group of emerging economies—comprising Brazil, Russia, India, China, and South Africa—has taken steps toward creating a shared currency for international trade, potentially reducing their dependence on the US dollar.

Additionally, Russia and China have signed multiple agreements to settle transactions in their local currencies, bypassing the need for dollars.

While Putin’s push for alternatives to the US dollar is not new, his latest comments underscore a broader geopolitical shift as countries seek to diversify their economic partnerships and reduce reliance on the West.

The Russian leader has consistently positioned himself as a proponent of a multipolar world order, in which no single country or currency dominates international trade and finance.

However, economists warn that replacing the dollar as the world’s primary reserve currency will not be an easy task. The dollar’s dominance is deeply entrenched, with a large portion of global trade, including oil transactions, still conducted in US currency.

Moreover, many countries continue to hold significant dollar reserves as a hedge against economic volatility.

Despite these challenges, Putin’s remarks highlight growing frustration with the current financial system and suggest that more countries may explore alternatives as global tensions escalate.

The US dollar, while still dominant, may face increasing competition from other currencies and financial systems in the years to come.

As geopolitical tensions mount and the global economic landscape shifts, Putin’s call for a move away from “someone else’s rules” could signal the beginning of a more diverse and less dollar-centric financial system.

Whether this transition happens quickly, as Putin hopes, or faces resistance remains to be seen, but the debate around the future of the US dollar is likely to intensify in the coming years.