Western sanctions have forced Russia to rely on the Chinese yuan for reserves and trade. China's financial system is deeply tied to the greenback, limiting diversification options. These include the entrenched role of the greenback in the global commodities trade and much larger foreign reserves than Russia, wrote Greene, a former senior advisor at the US Treasury. However, many CIPS participants are highly connected to the dollar financial system and potentially subject to the reach of US sanctions. The dollar is still kingIn short, China just can't copy Russia's sanctions-proofing playbook and is likely to continue orbiting around the dollar financial system in the near-term.

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Persons: —, China —, Robert Greene, Greene, China's, It's, dollarization, James Lord, Morgan Stanley's, Michael Zezas Organizations: Service, Carnegie Endowment Asia, US Treasury, Patomak Global Partners, Federal Reserve Bank of Boston Locations: Russia, China, Beijing, Russia's, Ukraine