Edited and translated by Huda Nada

On Monday, May 12, 2025, and under the patronage of Professor Dr. Mohamed Sami Abdel Sadeq, President of Cairo University, and under the supervision of Professor Dr. Hanan Mohamed Ali, Dean of the Faculty of Economics and Political Science, the Center for Economic and Financial Research and Studies organized a symposium titled “The Future of the Dollar and the Fate of Globalization.”

Professor Dr. Adla Ragab, the president of the Center for Economic and Financial Research and Studies, opened the symposium with words of appreciation to the audience, who attended both in person at the Faculty and online via Google Meet. She warmly welcomed the distinguished guests: Professor Dr. Gouda Abdel-Khalek, Professor of Economics at the Faculty and former Minister of Social Solidarity and Social Justice, and Professor Dr. Hassan Ali, Emeritus Professor of Economics at Ohio University and Nile University.

She dedicated several minutes to introducing them, highlighting some of their notable academic and professional achievements. Dr. Adla then outlined the main themes of the symposium: President Donald Trump’s policies and their implications on the U.S. dollar, the future of dollar dominance: Will it remain the leading global currency or be replaced by the Chinese yuan, a European currency, or a unified euro?, the fate of globalization and the potential disintegration of the bipolar global system (U.S. and Russia).

Dr. Hassan began by thanking the center, the faculty, and Cairo University, then welcomed the attendees. He started his talk by discussing the current dominance of the U.S. dollar, noting that over 60% of international transactions are conducted in dollars, 20% in euros, and the rest in other currencies. He added that central banks worldwide hold the dollar as a reserve currency.

He outlined the characteristics a currency must have to be considered a global reserve currency:

1. International trust and economic/political stability: historically, the dollar was backed by gold or silver.
2. High liquidity: the dollar is widely accepted and easily traded globally.
3. 3. Institutional and international law: This is represented by international institutions and central banks accepting the currency as a major part of their reserves and using it in pricing goods and international transactions.
4. Size and diversity of the issuing economy: the U.S. has the largest economy by nominal value; China leads by purchasing power (PPP), and second largest economy by nominal value
5. Transparency and governance: the U.S. Federal Reserve is among the most transparent globally. Its chair is appointed for 14 years, protecting it from political swings. The Fed also distinguishes itself from other global banks in that the central bank is typically government-owned, while the Fed is owned by commercial banks, which hold a 6% stake in it.
6. Safe haven status: in times of crisis, investors flock to the dollar.
7. Free convertibility: the dollar can be freely exchanged anywhere in the world.

In answering the question, “Why is the U.S. keen for the dollar to remain the world’s reserve currency?”, Dr. Hassan explained that printing a $100 dollar costs only about 40 cents. Around 52% of U.S. dollars are held and circulated outside the United States, generating pure profit for the American economy. This economic advantage makes the U.S. unlikely to give up its currency’s global role.

He referenced an article he wrote in the U.S. in 2006, highlighting the core American problem at that time: negative savings rates. Investment continued, but it was funded by foreign surpluses, particularly from countries purchasing U.S. treasury bonds. Even when savings improved to 7–8% of GDP, they later declined again.

Trump, he noted, sought to correct the U.S. trade deficit, especially with China, by imposing tariffs, assuming this would fix the issue. However, Dr. Hassan rejected this rationale, stating that low American productivity compared to countries like China, which has a 44% savings rate, was the real cause.

Professor Hassan Ali explained that the dollar's decline is due to lack of confidence and economic factors like rising US debt, financial instability, budget non-compliance, and its use as a political tool. He warned that using economic tools as political weapons weakens their future utility.

He argued that the turning point for the dollar’s credibility was its use in sanctions, which pushed nations to explore digital currencies and alternatives like BRICS. As a result, global dollar reserves dropped from 77% to 59%. Despite this, the Chinese yuan remains marginal in reserve holdings (2.5%) and will need at least 20 years to match the dollar’s dominance.

He predicted that globalization is shifting toward regionalism, and concluded by criticizing Trump, saying he brought out the worst in Americans and he is the worst thing that has happened to America, and even to the whole world.

Joining via Google Meet, Dr. Gouda responded to Trump’s slogan “Make America Great Again” with a famous line from Umm Kulthum song: “You want us to go back in time! tell time to go back.”. He emphasized that no American citizen today combines earning, frugality, and productivity. And the U.S. fiscal discipline is lacking. He linked this to Ibn Khaldun’s five stages of state development, stating that America is in the fifth stage: extravagance and waste.

He then addressed four main tools of American economic dominance:

1. The dollar as a global reserve currency.
2. SWIFT, society of worldwide interbank financial telecommunication.
3. Tariffs, used to protect U.S. interests and pressure rivals.
4. Trade deals, employed as geopolitical and economic leverage.

On globalization, he noted a shift over the past 80+ years from multilateralism to minilateralism (limited partnerships), that the world is witnessing a transitional phase, with the economic center of gravity moving east, marking the dawn of an Asian century after the Atlantic one.

Dr. Gouda acknowledged that Egypt’s economy is rent-based, relying on: Strategic rent, Natural resource rent, Geographic rent, including the Suez Canal. However, he warned that revenues from the canal may decline due to climate change enabling new and shorter navigation routes between East and West. He also referenced “enemies” in the region, including some Arab states, calling them “frienemies”, who are attempting to create alternative trade routes, posing a strategic threat to the canal. He asserted that Suez Canal’s value as a strategic asset remains, but its role as a mere shipping lane is diminishing.

He then moved on to discuss the situation in America, explaining that the dilemma facing American society is a lack of savings, a problem Egypt also suffers from, as we import more than we produce. He also explained that everything that happens in Egypt—economically, socially, and politically—is linked to the US dollar, which calls for serious consideration of severing the link between the Egyptian pound and the US dollar. He also warned against opening the doors wide open to hot capital, which could suddenly leave the country, as happened in 2022, emphasizing the need to establish strict controls on this type of investment. and ends his talk by thanking the audience.

Dr. Adla opened the floor for questions from both the in-person audience and online attendees. Highlights included:

●        A question was raised about assessing the economic value of the Suez Canal and Emirati investments in the region. Can enemies influence them?

●        Professor Gouda responded that we must not entrust our affairs to foreigners, emphasizing that developing the Suez Canal should not be done through foreign entities. He emphasized that the strategic importance of the Suez Canal as a waterway exists in the long term, but its economic value as a purely maritime waterway has begun to decline as a result of the long-term shifts taking place in the global economy.

●        Why do all countries seek to produce the same goods despite differing needs and resources?
Dr. Hassan emphasized economic integration over competition, which suits a world with varied needs and capacities.

●        Can globalization truly decline when only the U.S. is stepping back, while China and Europe remain committed?
The shift toward regionalism is due to global disruptions, wars, supply chain crises, etc. According to Dr. Gouda, economic power is still in transition, not fully shifted.

Dr. Adla ends the symposium by thanking both speakers for their valuable insights and expressing gratitude to the attendees.