Recently, one of the world’s oil powers dealt a hard blow to the dollar after announcing that it will not renew the agreement it had with the United States since 1974 to trade barrels of crude oil in this currency, and that it will give way to trading this commodity with other currencies, thus ending what many knew as the petrodollar era.
Since this happened, market analyses have focused on knowing the scope that this will have in the economic world, since for some it reduces the hegemony that the US currency had over its competitors, while others point out that it will only be a transition towards the world of digital assets.
The first thing to keep in mind here is that the termination of this agreement could have several important consequences, such as a possible weakness of the dollar against major competitors such as China and Russia (despite the sanctions), as well as a drastic shift in global geopolitics.
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Likewise, this decision by Saudi Arabia may have been driven by for several factors, including the desire to diversify their economic transactions beyond the US dollar, growing resentment towards US policy in the region, and the desire to increase their economic independence.
In a recent analysis, Edgar Jiménez, a finance professor at the Jorge Tadeo Lozano University of Bogotá, explained that the expiration of this agreement could have significant repercussions on the global economy, including the Colombian economy, as it opens the door for new competitors to enter the oil market.
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Thus, in what has to do with the local market, this expert said that we must begin by analyzing that there will be a step by step towards de-dollarization, which is becoming established globally, and Colombia could see changes in your business and financial relationships because of this, as you depend on this system.
Saudi Arabia
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“De-dollarization is the gradual process of reducing dependence on the US dollar in commercial transactions. For Colombia, this may mean a diversification of international reserves and greater use of other currencies such as the Chinese yuan and the European euro,” said the professor.
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For Jiménez, monetary diversification could benefit Colombia in its trade relations with countries that are leading the de-dollarization movement, such as China and Russia, and “this could open up new opportunities for trade and financial cooperation, benefiting key sectors of the Colombian economy.”
Dollars and pesos.
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This teacher highlighted that if this wave is taken advantage of, the country can achieve greater economic stability, since “currently, Colombia’s international reserves are mostly in dollars. With de-dollarization we could begin to see a greater inclusion of other currencies, which which could provide greater stability and reduce vulnerability to fluctuations in the dollar.”
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Looking at the upcoming changes from another perspective, the Finance professor at Jorge Tadeo Lozano University added that in the context of de-dollarization on the global scene, Bitcoin stands out for its growing importance, offering economies a viable alternative to diversify investments and reduce dependence on traditional currencies.
“Its decentralized nature and trust in the markets position it as an interesting option for Colombian investors,” said Jiménez, who was clear in warning that although bitcoin will not replace the dollar immediately, it should not be overlooked that its adoption is increasing.
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“The use of bitcoin could offer advantages in security and efficiency in transactions. Bitcoin allows for secure and fast transactions without the need for intermediaries, which can be especially useful in an environment of de-dollarization and changes in the global financial system,” Jimenez added.
Investments
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With these data mentioned, Edgar Jimenez indicated that the most important thing is to remain calm and be informed, since everything will be gradual and will require an exhaustive analysis, without falling into haste that could lead people to change their reserves or investments abruptly. In addition, he concluded, it is important to diversify and be alert to the opportunities and challenges that this new financial scenario presents.
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