December 9, 2023

Analysts have begun to consider the use of a future BRICS currency to reduce the impact of US sanctions and the dollar on international markets. While the rise of the US dollar after World War II was important in sparking an era of economic growth, the so-called weaponization of its ubiquitous use has forced some countries to consider other options for international trade.

Issuance of BRICS common currency under scrutiny

Zhou Wei, deputy director of the Institute of Economics and Business Administration of Central China Pedagogical University, has considered the possible implementation of the BRICS currency in fighting unilateral sanctions and the hegemony of the US dollar in international markets.

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According to Zhou, the weaponization of the US dollar has also created mistrust in American circles about the future of the currency, which is why the country is considering alternatives to its use. While the use of the US dollar presented many advantages after World War II, “later, as the world developed, including the continued development of the BRICS countries, the advantage of using the dollar in international agreements began to wane,” he said.

However, Zhou noted that the introduction of a unified BRICS currency bloc by Brazil, Russia, India, China and South Africa would not immediately replace the US dollar, and that the creation of such a currency would take years. He concluded,

This does not mean that the dollar will suddenly collapse, but we need to address the issue of de-dollarization.

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“If, for example, such a regional currency appears by the middle of this century, I think it will stimulate the development of both those countries and the whole world,” Zhou said.

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While the BRICS currency project is still in its infancy, Russia, one of the largest economies of the BRICS bloc, has moved to use the Chinese yuan for bilateral settlements to avoid US sanctions. On this, Qiang Xiaoyun, director of the Center for Russian-Central Asian Studies at the Shanghai Institute for International Studies where did it go,

The most promising way to move away from the Western payment system is to use the yuan or ruble in payment.

release is still pending

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The project to issue a common currency for transactions between countries of the BRICS bloc was mooted last year, when Russian President Vladimir Putin said the initiative was being considered at a BRICS summit hosted by China. , which was intended to target American hegemony. ,

More recently, Alexander Babakov, deputy chairman of the State Duma, said that the issue of such a currency would be debated during the next BRICS. meetingWhich will be held in August in Durban, South Africa, with new countries being added to the bloc.

What do you think about the use of a BRICS common currency as an alternative to the US dollar? Tell us in the comments section below.

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