China’s push for trade in yuan has downsides for Gulf states

Al-Monitor Pro Members

Sebastian Castelier

Business journalist covering Gulf economies

May 30, 2023

“Don't kiss your dollars goodbye just yet,” the International Monetary Fund’s managing director Kristalina Georgieva warned on Wednesday during the Qatar Economic Forum in Doha. Beijing struck its first-ever yuan-settled energy deal involving Emirati liquified natural gas in the first quarter of 2023. Paying for the import of Gulf fossil fuels in yuan is at the top of China’s list to lay the foundations for a greater global adoption of its currency, officially known as renminbi. But should the practice become more common, Gulf countries would ​​get “most of the downsides.” Yet a global surge of interest in de-dollarization — with a 600% increase in discussions on Twitter and Reddit in the first three months of 2023 — is offering Gulf countries an opportunity to display yuan-settled trade to warn the United States.