EU To Reduce Dependence On US Dollar As Sanctions Hit Trade With Iran

Source: https://eaworldview.com/

Plans to reduce European Union dependence on the US dollar have been rumoured for a while now, as China’s alternative to the Petrodollar continues to gain strength. The EU is not signing up to the move by Russia, China and the other BRICS bloc nations to replace the dollar but are thinking involvement with the emerging economies bid to break US economic hegemony will improve the 27 member Union’s ability to run an independent foreign policy without having to fear US bullying through sanctions for opposing Washinton’s attempts to dominate global political and economic events. The EU plan was unveiled on Wednesday by the European commission.

The proposal has gained support among European Union member states as companies in EU countries have felt presured to withdraw investments from Iran by the threat of punitive secondary sanctions from the US for any nation which permits its citizens or business community to trade with the Shi’ite Muslim theocracy.

The EU, unlike the US, wants to maintain the nuclear deal with Iran signed in 2015, but needs to deliver on its side of the bargain by increasing trade with Tehran. Less likely to be discussed in mainstream media is that European arms manufacturers, particularly those in Britain, Germany, France and, surprisingly perhaps, Sweden, will benefit greatly from a new arms race if they are in a position to supply both sides.

Iranian rulers are becoming impatient as the EU strives to create a financial mechanism to shield European exporters and importers from the effects of US sanctions on corporations, banks and individuals that continue to trade with Iran. US secondary sanctions can be applied on any European firm with links to the US market. I find this rather surprising as back in the 1960s when I studied economics, it was common knowledge that jurisdictions with lax trade regulation regimes like Panama or The Bahamas could be used to obfuscate paper trails and evade sanctions, tariffs and taxes.

The commission is perhaps reluctant to use Gibraltar’s port facilities for trans — shipping goods bound eventually for Iran because of the uncertain position of The Rock post Brexit. Instead Brussels is focusing on increasing the use of the euro in energy markets by creating a financial vehicle to facilitate settlement of oil contracts in the single currency, thus bypassing sanctions by avoiding any dollar transactions. Along with other such bilateral agreement systems, the plan is part of a longer-term move to “de-dollarise” the world economy.

Measures included in the EU policy involve using the euro as default currency in energy contracts agreed between EU member states and non-EU countries, as well as the creation of euro-denominated price benchmarks for crude oil. The EU is one of the world’s largest energy importers.

The commission press release also suggests the EU must develop “a full range of trustworthy interest rate benchmarks” in and a fully integrated instant payment system acceptable in all financial markets. The bloc will also seek to develop the role of the euro in foreign exchange markets.

In launching the long-term plan, EU economic affairs commissioner, Pierre Moscovici, said: “A wider use of the euro in the global economy yields important potential for better protecting European citizens and companies against external shocks and making the international finance and monetary system more resilient.”

The commissioner added these plans came “at a time where the recent global trends, the emergence of new economic powers along with the development of new technologies are supporting a potential shift towards a more diversified and multipolar system of several global currencies”.

Responding to the EU announcement an Iranian official said:
“Based on the news I recently received and was confirmed by a European commissioner, from now on, the EU is going to ditch the US dollar and just use the euro in the financial transactions of all European oil deals with other countries,” said Iran’s nuclear chief, Ali Akbar Salehi, on Thursday.

Speaking to reporters, the head of the Atomic Energy Organization of Iran (AEOI) said the amount of these transactions is more than €300 billion. “Previously, the EU used to pay 85 percent of the money for the oil it purchased from other countries in US dollars, but now with this new mechanism, all the money will be paid in euros,” he said.

Once the mechanism takes effect, the US dollar will be isolated as a global currency, and the US will no longer be able to use dollars in the current dominating way, Salehi added.

His comments came one day after the EU commission presented its plan to reduce the dollar’s overwhelming dominance of the global economy and to strengthen the role of the euro, particularly for energy transactions. There will be a lnee jerk reaction from the left of US politics, to blame Donald Trump for this development, the EU have already accused the Trump Administration of weaponising the reserve currency, although that is unfair because the US has used its position as holder of the reserve currency as a political weapon since the 1960s. In fact the move towards de-dolarisation, led by China, Russia and Iran, has been going on for some years now, the initial moves having been made early in the Obama era, though even before Obama took office there was widespread dissatisfaction with the way the USA used dollar dominance to influence political developments outside its borders. It has alredy attracted many trading partners, perhaps US economic belligerence is an attempt to combat this. If so it is the wrong approach.

European capitals have become increasingly frustrated with the global dominance of the dollar as a reserve currency, which hands the United States unparalleled diplomatic and economic power in a globalized world. This hostility was exacerbated when economic sanctions imposed on Russia after it’s annexation of Crimea in 2014. Many European nations were hit harder by those sanctions than Russia.

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Dedollarisation contagion: Germany Calls For Global Payment System Independent Of US

In what can only been seen as a vote of “no confidence” in the US dollar as global reserve currency, which effectively gives the US a  monopoly over global trade settlements infrastructure, Germans foreign minister Heiko Maas yesterday called for the creation of a new payments system independent of the US that would allow Brussels to be independent in its financial operations from Washington and as a means of rescuing the nuclear deal between Iran and the west.

Maas may have stopped short of openly supporting the Russia / China bid to replace the US dollar, but and independent European settlements system would have to exclude the dollar in trades between European nations and the BRICS bloc.

The German daily Handelsblatt reported that Maas said “Europe should not allow the US to act over our heads and at our expense. For that reason it’s essential that we strengthen European autonomy by establishing payment channels that are independent of the US, creating a European Monetary Fund and building up an independent Swift system,” he wrote, cited by the FT.

Maas who has made clear his opposition to the US use of sanctions to maintain its stranglehold on world trade, said it was vital for Europe to stick with the Iran deal. “Every day the agreement continues to exist is better than the highly explosive crisis that otherwise threatens the Middle East,” he said. The unspoken subtext was clear: Europe is no longer willing to be a vassal state to US monopoly over global payments, and will now aggressively develop its own payments network that is not subservient to Washington’s every whim.


German foreign minister Heiko Maas (Picture: Zero Hedge )

Belgium basedSwift, global payment network owned by a consortium of banks, enables financial institutions worldwide to send and receive information about financial transactions. Swift is supposedly politically neutral and independent but it has been used to block transactions and enforce US sanctions against various countries, most notably Iran.

In 2012, the Danish newspaper Berlingske wrote that US authorities seized money being transferred from a Danish businessman to a German bank via the system for a batch of US-sanctioned Cuban cigars. The transaction was made in US dollars, which allowed Washington to block it although the USA has no legal or moral right to stop sovereign nations trading with any country they want to.

Thorsten Benner, director of the Global Public Policy Institute, a Berlin-based think-tank supported Maas’s, saying his intervention was the “strongest call yet for EU financial and monetary autonomy vis-à-vis US.”

The German foreign minister’s words emphasise the dilemma facing European politicians as they struggle to maintain trade relations with Iran while coping with the fallout of US sanctions imposed by the US against companies doing business with Tehran.

As the FT adds, the EU is determined protect European businesses from retaliation by Washington for trading with Iran, but has failed to convince EU companies more concerned about maintaining their access to the lucrative US market than in the more modest opportunities presented by Iran.

Last month Washington rebuffed a high-level European plea to exempt crucial industries from sanctions. Mike Pompeo, US secretary of state, and Steven Mnuchin, Treasury secretary, formally rejected an appeal for carve-outs in finance, energy and healthcare made by ministers from Germany, France, the UK and the EU.

Swift will also be affected. Unless it wins an exemption from sanctions, which is unlikely, it will be required by the US to cut off certain Iranian banks from its network by early November or face possible countermeasures against both its board members and the financial institutions that employ them.

Maas’s stark warning against US domination of global payments comes with relations between Germany and the US in their worst state for decades. Mr Trump has chastised Berlin over its large surplus in bilateral trade with the USA, its relatively low military spending and its support for Nord Stream 2, a new gas pipeline that will bring Russian gas directly to Germany.

In short: Europe has finally had enough and it plans on hitting Washington where it truly hurts: the money.

Germany Furious About Washington’s Latest Sanctions On Russia

103887125-russian-sanctions

Image source: Millennium report

Anybody who has an above zero IQ and follows alt_news must be aware by now that the US Congress’ latest sanctions against Russia are futile and will end up hurting US allies –  and this time possibly the USA itself.  Since Russia hasn’t done any of the things Washington and the NATO poodles accuse it of, like interference in US elections (US secret services have repeatedly affirmed there is no evidence whatsoever, not that you would have read that in mainstream media), interference in Ukraine (It is generally known that Washington / NATO / EU instigated and paid for the bloody Maidan coup in February 2014); annexing Crimea (an overwhelming (97%) vote by the people of Crimea for reincorporation into the Russian Federation – their given right, according to the UN Charter). Even if Russia wanted to, she couldn’t correct any of her ‘mistakes’. They are all fabrications.

None of Washington’s allegations have any substance. But the western presstitutes and the bitter and resentful Democrats, their arses still hurting from the kick Trump gave them, keep hammering the idea that Russia helped Trump steal the election, into the dimwitted brains of a dumbed down populace. We can only repeat with Joseph Goebbels, Hitler’s Propaganda Minister: “Let me control the media, and I will turn any Nation into a herd of Pigs. Well, the western Anglo-Zionist propaganda machine has successfully turned western civilizations (sic) into a herd of pigs.

Is every member of the US Congress really so stupid as to believe that Russian interference in US presidential elections swung it for Trump? FFS the corrupt and crooked Hillary Clinton is so hated the Republicans could have run Ivan The Terible as their candidate and still won. Or do the leaders of the people simply believe “We, the US of A and Masters of the Universe, interfere in the internal politics of sovereign nations all the time, so Russia and China must be doing it too”?

Although President Trump appears to utterly dislike that Congress overwhelmingly approved the new ‘sanctions’  The Donald really had no option but to sign it into law. Had he used his veto it would certainly have been overruled and that could have triggered another crisis for his troubled presidency.

Angela Merkel is leading resistance to the new set of sanctions which, she rightly points out, will do nothing to Russia. Russia is way beyond the reach of US economic sanctions, as its economy is detached from that of the west apart from oil and gas exports to the EU, which the EU cannot do withouit. Russia as well as China, and the entire Shanghai Cooperation Organization (SCO) have learned fast how to respond to Washington’s economic bullying.

President Putin, while routinely protesting at the imposition of more stupid sanctions, must be chuckling about the pathetic ignorance of Washington in clinging to a belief in its own Masters of the Universe mythology in handing out punishments to lesser nations. Hilariously, the new sanctions would, for example,  enable the US to fine European companies participating in joint Russian-European pipeline projects. Not only are Russia and China now separately superior to the USA, together they could annihilate the US military. In fact, these anti-Russia sanctions will only penalize Europe, but may serve to shock British and EU leaders out of their servile dependence  on US leadership.

So, why do the ‘sanctions’ continue? – Propaganda, stupid! – The rest of the world must believe America is the greatest, most powerful and can police the world at their whim. That’s Washington’s ultimate tool for survival – a web of lies clad in massive propaganda – exactly following the edict of Goebbels.

Brexit: U.S. Pact Will Be One Deal Among Many for ‘Global Champion’ Britain

After establishing last week that the EU has no legal right to attempt in any way to stop Britain opening negotiations on trade deal with the USA and other international trading partners the government’s trade secretary has said that talk with US officials on post Brexit trade arrangements will start within a few days.

International Trade Secretary Dr Liam Fox has said that the “very big, very powerful” trade deal which U.S. President Donald Trump wants with Brexit Britain will be one of many around the world, as the country takes its place as “the global champion for free trade”.

The Leave campaigner, who is currently in the U.S. for trade talks, said Britain would be “at the heart of international trade” after Brexit in an article for The Sunday Times.

Freed from European Union rules which prevent member-states from negotiating their own trade deals, “[Britain] will, for the first time in more than 40 years, be able to shape trade policy according to our own national interests,” he noted.

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Rebellion Against EU Authoritarianism Escalates As 8th Member Nation Threatens Referendum
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Is Brexit A Harbinger Of Doom For The ‘Experts’
The Brexit vote, the decision by a democratic majority in Britain to leave the European Union has sent shockwaves around the world. Not only does the EU now face a tsunami of departures, the usurpation of democracy by ‘experts’ ( technocrats ) has been challenged and exposed as a sham.

BREXIT vs. GREXIT – The Truth About The European Union And How It Treats Members
Unless the testicularly deficient politicians stand up for their nations he only thing that will halt the European Union’s push beyond Europe’s geographical borders to incorporate Asian, middle eastern and north African nations is war. Power is addictive and the bean counters of Brussels have ambitions far beyond Europe.

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When I had to defriend a Facebook contact because she was arguing in favour of the EU, it was not simply because I support Brexit that I had become pissed of with her, it was the snobbish and condescending way she dismissed supporters of LEAVE and their case. People are entitled to their opinion on the European Union, but they should check the ‘facts’ they post in support of their arguments.

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Dutch Referendum This Week Shows why We Should Leave The EU.
Few of you were aware probably that there is an EU referendum vote in The Netherlands this week. As usual with anything negative about the EU barely a word has been printed in the topic in mainstream media and the silence from our notionally unbiased national broadcaster The Bolshevik Broadcasting Corporation (BBC) has been deafening.

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Blessed Are The Cheesemakers #nnn

Being someone who does not do God I tend to the view that The Sermon On The Mount was not a real historical event, but a fiction made up by Saul Of Tarsus, the Zionist reject who having failed his exams for God’s chosen peoples’ highest ecclesiatical order, threw a hissy fit and invented his ownn cult, Christiaity and its own profit generator prophet, Jesus.

Blessed are the meek my arse, here on planet reality the mek get spat upon, shat upon and ratted on to quote that other prophet, Paul Simon.

Don’t write off The sermon on the mount entirely however, it does offer us some insights into the human condition. And the parody of it in Monty Python’s Life Of Brian contains the nearest thing to a universal truth we have. When the people at the back who are struggling to hear are getting the ‘Blesseds’ relayed by chinese whispers, blessed are the peacemakers becomes “Blessed are the cheese makers.”


Blessed are the cheesmakers – from The Life Of Brian

Why is this a universal truth?

Because forget the moon landing, the steam engine, the Oxford English Dictionary, The Pyramids, The Temple Of Diana at Ephesus, the complete works of Shakespeare and all that dreck, by far the biggest step humanity took on the road to civilization was the invention of cheese.

Though the food fascists might have a down on it because it is too tasty, too nourishing and too natural, cheese is one of the great props upon which western civilisation is built. If that was not true why are people doing things like this.

Cheese Smuggler Caught With Half a Ton As Sanctions Hit Basic Foodstuffs

While Putin, Obama the EU’s seven dwarfs play geopolitical chess over Ukraine, Syria, oil, the reserve currency and the Grexit, ordinary people suffer, and are reduced to smuggling basic foodstuffs like European cheese into Russia and ordinary natural gas in vast quantities into Germany.

A Russian cheddar-runner (doesn’t sound as romantic as rum-runner or boootlegger I know) was apprehended by Russian border guards as he attempted to cross the border between EU member Poland and the Kaliningrad enclave yesterday with 460kg of European cheese in the boot of his car, thus breaking US led sanctions. The Guardian reports that the man claimed he was not smuggling for commercial purposes, but was a fan of European cheese. It’s strictly for personal use he told customs officials, claiming that he was aware of the law but hoped he would not be searched.

Russia instituted wide-ranging bans on the import of European-made foodstuffs into Russia in a bid to harm EU agribusiness in retaliation for sanctions imposed by the USA and EU on the Russian economy last year. The cheese business has been one of the most visible sectors affected by the ban. Large amounts of cheese specifically for the Russian market were laid down for ageing months and years before the ban. That cheese is now reaching maturity but stockholders can find no market outside Russia for it.

Russian cheese makers have even tried to imitate popular European cheeses instead, with varying degrees of success.

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Bums Up, Zimbabwe Spokesman Tells Obama

Zimbabwe official tells Obama, go hang from a banana tree, bums up.

Let’s see how the zealots of the Obamessiah cult manage to accuse this guy of racism because … well he’s Zimbabwean and humans don’t get much blacker than that, but as every American liberal knows,, the only reason anyone would criticise Obama is because they are racist and can’t stand the idea of a black man being president, isn’t it. And what kind of creatures hang from banana trees. So monkey boy’s fans are sure to start squealing.

h/t Zero Hedge:
According to NewZimbabwe.com, Washington has said it will accelerate sanctions imposed against Harare in 2003, due to the Robert Mugabe-led government’s closer ties with Russia over the US$3 billion Darwendale platinum project.

Harare Herald columnist Nathaniel Manheru (who is thought to be Mugabe’s spokesman), reported that Washington explained its expectations on Zimbabwe, namely that Zimbabwe was expected (read required) to support those sanctions by avoiding any association with companies sanctioned by the Americans and their Western allies, or their subsidiaries or affiliates.

Manheru said “it was ridiculous for the US to refuse to lift sanctions against Harare and then demand support for its measures against Moscow… This is where I am tempted to tell the American government to go and hang, hang on a banana tree, bums up.”]

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Ah Vienna

As rumors of new E U sanctions against Russia’s major energy firms are leaked to the news feeds with thw whisper that the measures will be announced tomorrow, it appears there is a rift in the union. Peter Spiegel of The Financial Times reports that one country holding out on sanctions has led to an emergency meeting of EU diplomats being called this very evening.

Nobody has mentioned which country it might be but the Boggart Blog bookie is not taking bets on anywhere that has a name beginning with an ‘A’ and ending in ‘ustria’…