China's De-dollarization Stalls as Allies Defect

China faces slowing growth and lost allies, notably Venezuela. Analysis of de-dollarization setbacks amid US military dominance.

English · Original discussion in Spanish · Published

China: A Noose Tightening? Losing Allies and Slowing Growth
In January 2025, Venezuela announced it would stop using the yuan to pay for its oil exports, a symbolic and practical blow to China's de-dollarization strategy. Meanwhile, its economic growth is decelerating: from 14% annually two decades ago to 5% today, with suspicions of statistical manipulation. The question dividing analysts is whether China has fallen into a trap or is trinc a long-term strategy.

The Yuan Loses a Key Piece
Oil trade in yuan was a pillar of Chinese de-dollarization, with clients like Russia, Iran, and Venezuela. Venezuela's decision to return to the dollar, after pressure from the US, shows the vulnerability of the strategy: without military backing, sanctions and threats can reverse pogre. The debate reflects that, although the yuan gains ground in trade with Russia and parts of Asia, dollar hegemony rests on military strength and the SWIFT system, not just trust.

Chinese Growth: Real Deceleration or Concealment Strategy?
Official data puts Chinese GDP growth around 5%, far from the 14% of 20 years ago. Some analyses suggest China understates figures to appear weak, while others argue the investment-and-export-led growth model is exhausted. The discussion includes comparative tables of per capita wealth where China still lags behind the US, but with an upward trend.

The US Military Shadow and Fracking Exhaustion
The US demonstrates its willingness to use force in Venezuela, Greenland, and other scenarios, while China avoids direct confrontation. Simultaneously, American fracking reserves are estimated at only 5-10 years, which could explain the interest in recovering Venezuelan production. This future energy dependency could be an Achilles' heel for the superpower.


The debate leaves several questions open: Can China sustain its model without military capacity equivalent to its economic power? Or is de-dollarization unstoppable in the long run? What seems clear is that the game is far from decided.

Related Forum Discussions

Also available in: Deutsch

Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (113 replies).

More summaries

All summaries in English →

-
Back