Russia Abandons Yuan Push as US Sanctions Bite: Dollar Stays on Top
Russia has dropped its push to replace the dollar with China's yuan, Bank of Russia data shows, as US sanctions cut the yuan's share of export payments to 22%.
Image: Wikimedia Commons / Юрий Д.К.
MOSCOW — Russia has effectively abandoned its effort to replace the United States dollar with China's yuan in foreign trade, according to Bank of Russia data, after American secondary sanctions forced Chinese banks to step back from Russian payments.
The yuan's share of payments for Russian exports has fallen to 22 percent this year, down from a peak of about 44 percent in mid-2024, the central bank's figures show. In trade with Asia, Russia now receives rubles for 69 percent of its exports.
Key Takeaways
- The yuan's share of payments for Russian exports has halved to 22 percent this year, from about 44 percent in mid-2024.
- Russia now settles 69 percent of its Asian export receipts in rubles, after Chinese banks pulled back under US sanctions.
- Beijing says it is not trying to replace the dollar, and the yuan is 6 to 7 percent of global payments on the broadest measure.
Why Russia Turned to the Yuan — and Why Chinese Banks Pulled Back
Russia embraced the yuan at speed after the United States and its allies imposed sanctions over the invasion of Ukraine in 2022. Cut off from dollars and euros, Russian businesses, banks and bond markets turned to the Chinese currency, which became the most traded currency on the Moscow Exchange.
The reversal began in June 2024, when the United States widened the grounds for secondary sanctions on institutions dealing with Russia. Fearing they could be cut off from the dollar system, major Chinese banks wound down cooperation, froze payments and returned funds, and the Bank of Russia asked domestic banks to restrain yuan lending. President Xi Jinping has spoken of making the yuan a powerful currency, but Beijing says it is not trying to replace the dollar.
How Much Has the Yuan's Share of Russian Exports Fallen?
The figures show the scale of the retreat: the yuan's share of export settlements has halved this year from its mid-2024 peak, and Russia has filled the gap with its own currency. In trade with Asia, rubles now account for 69 percent of export receipts.
| Measure | Mid-2024 peak | 2026 |
|---|---|---|
| Yuan share of Russian export payments | About 44% | 22% |
| Ruble share of Russian export receipts from Asia | Not disclosed | 69% |
| Fees on Russia-China cross-border payments via intermediaries | Routine levels | 15% to 20% |
With the largest Chinese banks unwilling to process transactions directly, Russian companies now depend on third-party intermediaries. Those arrangements have driven fees as high as 20 percent, according to logistics provider STT Logistics, and caused unpredictable delays. The same pressure has shaped trade: China's trade surplus passed $1 trillion in the first ten months of the year.
What Russia's Yuan Reversal Means for the Dollar and BRICS
The reversal is a setback for BRICS efforts to build payment systems outside the reach of United States sanctions. Russia's experience was the most ambitious test of whether a major economy could settle a large share of its trade in a currency other than the dollar, and the test has now run in the dollar's favour.
Beijing argues standard measures understate the yuan's use, because volumes on CIPS, China's own payments system, have grown. Pan Gongsheng, governor of the People's Bank of China, puts the yuan's share of global payments at 6 to 7 percent once domestic bank transactions are included. Even on that broader measure, the currency remains a small player. For American policymakers, the figures are evidence that secondary sanctions work, as hot October inflation data pushes the Federal Reserve toward further rate increases.
Frequently Asked Questions
Why did Russia abandon the yuan for trade payments?
Russia moved away from the yuan after the United States widened secondary sanctions in June 2024. Major Chinese banks, fearing they could lose access to the dollar system, stopped processing Russian transactions.
What percentage of Russian exports are now paid in yuan?
The yuan's share has fallen to 22 percent this year, down from about 44 percent in mid-2024. In trade with Asia, Russia now receives rubles for 69 percent of its exports.
Does Russia's yuan reversal mean the dollar will stay the world's main currency?
The reversal underlines the dollar's dominance and the obstacles facing countries seeking alternatives to US-controlled payment networks. The yuan is only 6 to 7 percent of global payments on the broadest measure.
What happens next for Russia-China trade payments?
Russian businesses will likely keep relying on costly intermediaries while Chinese banks stay cautious. The Bank of Russia's next external-sector data will show whether the yuan's share keeps falling.
