By Pepe Escobar
December 17, 202:
Information Clearing House
Jinping and Vladimir Putin spent an hour and 14
minutes in a video conversation on Wednesday.
Geopolitically, paving the way for 2022, this is the
one that really matters – much more than
Putin-Biden a week ago.
Kremlin press secretary
Dmitry Peskov, who generally carefully measures his
words, had previously hinted that this exchange
would be “extremely important.”
It was obvious the two
leaders would not only exchange information about
the natural gas pipeline Power of Siberia 2. But
Peskov was referring to prime time geopolitics: how
Russia-China would be coordinating their
countercoups against the hybrid war/Cold War 2.0
combo deployed by the US and its allies.
While no substantial leaks
were expected from the 37th meeting
between Xi and Putin since 2013 (they will meet
again in person in February 2022, at the start of
the Beijing Winter Olympics), Assistant to the
President for Foreign Policy Yuri Ushakov did manage
to succinctly deliver at least two serious bits of
These are the highlights of
- Moscow will inform Beijing about the
progress, or lack thereof, in negotiations with
the US/NATO on security guarantees for Russia.
- Beijing supports Moscow’s demands on US/NATO
for these security guarantees.
- Putin and Xi agreed to create an
“independent financial structure for trade
operations that could not be influenced by other
countries.” Diplomatic sources, off the record,
say the structure may be announced by a joint
summit in late 2022.
- They discussed the Biden-hosted “Summit for
Democracy,” concluding it was counterproductive
and imposed new dividing lines.
Of all of the above, the
third point is the real game-changer – already in
the works for a few years now, and gaining
definitive momentum after Washington hawks of the
Victoria “F**k the EU” Nuland kind recently floated
the idea of expelling Russia from SWIFT – the vast
messaging network used by banks and other financial
institutions to make money transfer instructions –
as the ultimate sanctions package for the
non-invasion of Ukraine.
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Putin and Xi once again
discussed one of their key themes in bilaterals and
BRICS meetings: the need to keep increasing the
share of the yuan and ruble in mutual settlements –
bypassing the US dollar – and opening new stock
market avenues for Russian and Chinese investors.
Bypassing a SWIFT mechanism
“influenced by third counties” then becomes a must.
Ushakov diplomatically put it as “the need to
intensify efforts to form an independent financial
infrastructure to service trade operations between
Russia and China.”
Russian energy businesses,
from Gazprom to Rosneft, know all there is to know
not only about US threats but also about the
negative effects of the tsunami of US dollars
flooding the global economy via the Fed’s
This Russia-China drive is
yet another dimension of geoeconomic, geostrategic
and demographic power rapidly shifting towards
Eurasia and possibly foreshadowing the advent of a
new world system related to other matters Putin-Xi
certainly discussed: the interconnection of Belt and
Road with the Eurasia Economic Union (EAEU), the
expanded reach of the Shanghai Cooperation
Organization (SCO) and the coming Chinese presidency
of BRICS in 2022.
The US – with US$30 trillion
in debt, 236% of its militarized GDP – is virtually
bankrupt. Russia-China have already experimented
with their alternative payment systems, which will
The most important banks in
both countries will adopt the system – as well as
banks across Eurasia doing business with them, and
then vast swaths of the Global South. SWIFT, in the
long run, will be used only in exceptional cases if
China and Russia have their way.
Now to the heart of the
Ushakov confirmed that the
Russian Federation has submitted proposals on
security guarantees to the US. As Putin himself
had confirmed even before talking to Xi, it’s all
about “indivisible security”: a mechanism that has
been enshrined all across the territory of the
Organization for Security and Co-operation in Europe
since a 1975 summit in Helsinki.
Predictably, under orders of
the powers that be, NATO Secretary-General Jens
Stoltenberg already rejected it.
Both Xi and Putin clearly
identify how Team Biden is deploying a strategic
polarization gambit under good old divide-and-rule.
The wishful thinking at play is to build a
pro-American bloc – with participants ranging from
the UK and Australia to Israel and Saudi Arabia – to
That’s what’s behind the
narrative thunderously splashed non-stop all across
the West – to which Biden’s Summit for Democracy was
also tied. Taiwan is being manipulated against
Beijing while Ukraine is being literally weaponized
against Russia. “China aggression” meets “Russian
Beijing has not fallen into
the trap but has asserted at different levels that
Taiwan will eventually be integrated into the
mainland motherland, without any ludicrous
“invasion.” And the wishful thinking that massive
American pressure will lead to cracks inside the
Chinese Communist Party is also likely generating
Ukraine is a much more
volatile proposition: a dysfunctional nightmare of
systemic instability, widespread corruption, shady
oligarchic entanglements and poverty.
Washington still follows the
Zbigniew Brzezinski-concocted Maidan plan laid out
for cookie distributor Nuland in 2014. Yet seven
years later, no American “strategist” managed to
understand why Russia would fail to invade Ukraine,
which has been part of Russia for centuries.
For these “strategists”, it’s
imperative that Russia faces a second Vietnam, after
Afghanistan in the 1980s. Well, it’s not going to
happen because Moscow has no interest whatsoever in
It does get more complicated.
The ultimate fear dictating all US foreign policy
since the early 20th century is the
possibility of Germany clinching a new version of
Bismarck’s 1887 Reinsurance Treaty with Russia.
Add China to the combination
and these three actors are able to control just
about the entire Eurasian landmass. Updating
Mackinder, the US would then be turned into a
geopolitically irrelevant island.
Putin-Xi may have examined
not only how the imperial hybrid war tactics against
them are floundering against them, as well as how
the tactics are dragging Europe further into the
abyss of irrelevance.
For the EU,
as former British diplomat Alastair Crooke points
out, the strategic balance is a disaster: “The
EU has virtually ruptured its relations with both
Russia and China – at the same time. Washington’s
hawks wanted it. A ‘European Brzezinski’ certainly
would have advised the EU differently: never lose
both in tandem – you are never that powerful.”
No wonder the leadership in
Moscow-Beijing can’t take anyone in Brussels
seriously – be it assorted NATO chihuahuas or the
spectacularly incompetent Ursula von der Leyen at
the European Commission.
A faint ray of light is that
Paris and Berlin, unlike the Russophobic Poland and
the Baltic fringe, at least prefer having some sort
of negotiation with Moscow over Ukraine as opposed
to slapping on extra sanctions.
Now imagine Russian Foreign
Minister Sergey Lavrov explaining the ABCs of
foreign policy to a clueless Annalena “Grune”
Baerbock, now posing as German foreign minister
while displaying a fresh mix of incompetence and
aggressiveness. She actually placed the phone call.
Lavrov had to meticulously
explain the consequences of NATO expansion; the
Minsk agreement; and how Berlin should exercise its
right to pressure Kiev to respect Minsk.
No leaks about it should be
expected from Ushakov. But it’s fair to imagine that
with “partners” like the US, NATO and the EU, Xi and
Putin should conclude that China and Russia don’t
even need enemies.
Putin got straight to the point. At the opening
of his one hour and fourteen minute video
conversation with Xi Jinping on 15 December, he
described Russia-China relations as “an example
of genuine inter-state cooperation in the 21st
myriad levels of cooperation have been known for
years now – from trade, oil and gas, finance,
aerospace and the fight against Covid-19, to the
progressive interconnection of the Belt and Road
Initiative (BRI) and the Eurasia Economic Union
the stage was set for the announcement of a
serious counter-move in their carefully
coordinated ballet opposing the relentless
Hybrid War/Cold War 2.0 combo deployed by
Assistant to the President for Foreign Policy
Yuri Ushakov succinctly explained, Putin and Xi
agreed to create an “independent financial
structure for trade operations that could not be
influenced by other countries.”
Diplomatic sources, off the record, confirmed
the structure may be announced by a joint summit
before the end of 2022.
a stunning game-changer in more ways than one.
It had been extensively discussed in previous
bilaterals and in preparations for BRICS summits
– mostly centered on increasing the share of
yuan and rubles in Russia-China settlements,
bypassing the US dollar, and opening new stock
market options for Russian and Chinese
we’ve come to the crunch. And the catalyzing
event was none other than US hawks floating the
– financially nuclear – idea of expelling Russia
from SWIFT, the messaging network used by
11,000+ banks in over 200 countries, as well as
financial institutions, for rapid money
off Russia from SWIFT would be part of a harsh
new sanctions package developed in response to
an ‘invasion’ of Ukraine that will never happen
– mainly because the only ones praying for it
are professional NATO warmongers.
from a strategic blunder
again, an American strategic blunder offers the
Russia-China self-described “comprehensive
strategic partnership” the chance to advance
put it very diplomatically: it’s time to bypass
a SWIFT mechanism “influenced by third
countries” to form “an independent financial
amounts to a serious game-changer for the entire
Global South – as scores of nations yearn to be
released from a de facto US dollar dictatorship,
complete with recurring Fed quantitative easing
and China have been experimenting with their
alternative payment systems for quite a while
now: the Russian SPFS (System for Transfer of
Financial Messages) and the Chinese CIPS (Cross
Border Interbank Payment System).
won’t be easy, as the most powerful Chinese
banks are deep into SWIFT and have expressed
their reservations about SPFS. Yet, they will
have to inevitably integrate prior to the launch
of the new mechanism, possibly in late 2022.
the most important Russian and Chinese banks –
from Sberbank to the Bank of China – adopt the
system, the path opens for other banks across
Eurasia and the Global South to join in.
long run, SWIFT, prone to non-stop American
political interference, will be increasingly
marginalized, or restricted to Atlanticist
Bypassing the US dollar, on trade and all sorts
of financial settlements, is an absolutely
central plank of the ever-evolving Russia-China
notion of a multipolar world.
road will be long, of course, especially when it
comes to offering a solid counterpoint to the
US-controlled global financial system, a maze
that includes the humongous investment houses of
the BlackRock, Vanguard and State Street
variety, with their interlocking shareholding of
virtually every major multinational company.
SWIFT escape will rapidly gain momentum, because
it is inextricably linked to a series of
developments that Putin-Xi touched upon in their
conversation, the most important of which are:
progressive interconnection of BRI and EAEU,
offering expanding roles to the BRICS-run New
Development Bank (NDB) as well as the Asia
Infrastructure Investment Bank (AIIB).
increasing geopolitical and geo-economic reach
of the Shanghai Cooperation Organization (SCO),
especially after the admission of Iran in
crucially, the upcoming Chinese presidency of
the BRICS in 2022.
China in 2022 will invest deeply in
expanded BRICS club will be linked to a
development process that includes:
1. The consolidation of the
Comprehensive Economic Partnership (RCEP)
– a massive East Asia trade deal uniting China,
the ASEAN 10 and Japan, and South Korea, as well
as Australia and New Zealand.
African Continental Free Trade Area (ACFTA).
the memoranda of understanding signed between
the EAEU and MERCOSUR and between the EAEU and
Yaroslav Lissovolik, one of the world’s leading
experts on BRICS+, argues that it’s now time for
BRICS+ 2.0, operating in a system that opens
“the possibility for bilateral and plurilateral
agreements to complement the core network
of regional alliances formed by BRICS countries
and their respective regional neighbors.”
we’re talking about a major qualitative jump
in terms of economic development across the
Global South, the question is inevitable. What
about West Asia?
these interconnections, plus an escape from
SWIFT, will certainly profit the China-Pakistan
Economic Corridor (CPEC), arguably the flagship
BRI project, to which Beijing plans to annex
will be progressively connected to the future
Iran-China corridor via Afghanistan, part of the
20 year Iran-China strategic deal in which BRI
projects will be prominently featured. Iran and
China already trade in yuan and rials, so
settlements between Iran and China in a
non-SWIFT mechanism will be a given.
happened to Iran is a classic example of SWIFT
becoming hostage of imperial political
manipulation. Iranian banks were expelled from
SWIFT in 2012, because of pressure from the
usual suspects. In 2016, access was restored as
part of the JCPOA, clinched in 2015. Yet in
2018, under the Trump administration, Iran was
once again cut off from SWIFT.
that will ever happen with Iran joining the new
that leads us to the interconnection of China’s
BRI expansion in Iran, Iraq, Syria, Lebanon and
Yemen. The reconstruction of Syria may be
largely financed via the non-SWIFT mechanism.
Same for China buying Iraqi energy. Same for the
reconstruction of a Yemen possibly hosting a
Chinese-owned port, part of the
“string of pearls.”
Arabia, the Emirates and Israel may remain in
the US financial sphere of influence, or lack
thereof. And even if there is no BRICS nation
anchoring West Asia, and no regional integration
economic agreement on the horizon, the role of
the economic integrator is bound to be
eventually played by China.
will play a similar role to Brazil anchoring
MERCOSUR, Russia anchoring the EAEU and South
Africa anchoring the SADC/SACU.
BRI and the EAEU will get a tremendous boost by
bypassing SWIFT. You simply can’t go multipolar
if you trade using (devalued) imperial legal
EAEU and those interlocking economic development
agreements, combined with digital technology,
will be integrating billions of people in the
of a possible, auspicious future spelling out
cheap telecom delivering financial services and
world market access, in a non-dollar
environment, to all those who have been so far
cut off from a truly globalized economy.