Another country joins the growing list of nations to drop the dollar for trading with another nation. In the case of Chile, it has done a deal with China to trade in the growing popular renminbi. Its another kick in the stones for the US dollars reserve status which is losing ground in world trade.

For simplicity’s sake here is the full list of “bilateral” arranagements in the past year as presented previously: “World’s Second (China) And Third Largest (Japan) Economies To Bypass Dollar, Engage In Direct Currency Trade“, “China, Russia Drop Dollar In Bilateral Trade“, “China And Iran To Bypass Dollar, Plan Oil Barter System“, “India and Japan sign new $15bn currency swap agreement“, “Iran, Russia Replace Dollar With Rial, Ruble in Trade, Fars Says“, “India Joins Asian Dollar Exclusion Zone, Will Transact With Iran In Rupees“, “The USD Trap Is Closing: Dollar Exclusion Zone Crosses The Pacific As Brazil Signs China Currency Swap.”

And now the latest: “China, Chile To Establish Strategic Partnership, Boost Trade… Launch Currency Swap and Settle In Renminbi

 China and Chile agreed Tuesday to upgrade their bilateral ties to a strategic partnership, and double trade in three years.

 Chinese Premier Wen Jiabao and Chilean President Sebastian Pinera announced Tuesday the establishment of China-Chile strategic partnership and the completion of negotiations on investment-related supplementary deals to a bilateral free trade agreement.

 China would like to be actively engaged in Chile’s infrastructure construction and work with Chile to promote the development of transportation networks in Latin America, said Wen.

 Meanwhile, Wen suggested that the two sides launch currency swaps and expand settlement in China’s renminbi.

China appears to be getting all its ducks lined up before it makes it final move. The question is, how much of the renminbi will be gold backed?

So to summarize, the list of countries that China is transacting with directly (that we know of), and bypassing the USD entirely, is as follows:

  • Japan
  • Russia
  • Iran
  • India
  • Brazil
  • and now, Chile

In other words, it looks like the BRICs already have their “bilateral” arranagements all sorted out, and are now quietly moving into other suppliers of key resources with swap deals, all without any mention of the word “dollar.”

How soon until China re-dips its toe in Europe with a modest “bailout” nobody can refuse in exchange for a simple caveat: you get paid in renminbi?

Source: ZeroHedge

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