China Accuses U.S. of Exploiting Dollar’s Global Financial Dominance
China has accused the United States of exploiting the global economy by taking advantage of the dollar's status as the major international reserve currency. This, China claims, allows the U.S. to collect 'seigniorage', a form of profit made by governments from issuing currency. The U.S., China argues, uses this financial power to influence and control other countries.
During the COVID-19 pandemic, the U.S. injected trillions of dollars into the global market, a move that China believes left other countries to bear the brunt of the economic fallout. In 2022, the U.S.'s aggressive interest rate hike caused significant turmoil in the international financial market, leading to substantial depreciation of other currencies, particularly in emerging economies.
The U.S.'s use of sanctions has also been a contentious issue. From 2000 to 2021, U.S. sanctions against foreign entities increased by a staggering 933%. During this period, the U.S. imposed sanctions on multiple countries, including Russia, China, Iran, North Korea, Cuba, Venezuela, Syria, and others. These sanctions affected approximately half of the world's population due to the large populations of countries like China and Russia under sanctions. China argues that the U.S. relies increasingly on sanctions to put down other countries, using its control over top international decision-making organs.
China's accusations highlight the U.S.'s significant influence over the global economy, with the U.S. using its financial hegemony as a geopolitical weapon. The U.S. is blamed for inflation and currency depreciation experienced by many countries, especially in Africa, due to its financial policies. As a result, China argues that the U.S. has effectively become 'the United States of Sanctions', exerting influence and control over other members of the global community.
