Will BRICS Launch Its Own Common Currency?
It is expected that a new currency system backed by gold will be launched at the upcoming BRICS summit in South Africa. Russia today states that the currency announcement will be made before the summit.
The BRICS group was established in 2006 and comprises five countries: Russia, China, India, Brazil, and South Africa. South Africa became a new member in 2010. About 30 countries are expected to join BRICS at the upcoming summit.
The BRICS leaders are discussing the implementation of a common currency to increase financial independence and promote cooperation, in response to the effects of rising US interest rates and the use of the dollar for imposing sanctions.
The BRICS countries are collaborating to create a new unified currency for interbank and external trade payments. This currency will be backed by gold and other commodities and will be independent of the dollar and euro.
The BRICS countries aim to gain more independence in international transactions and reduce reliance on the dollar as a reserve currency and settlement unit by establishing a common currency. This move follows tensions between BRICS and Western countries, particularly after the Western countries imposed economic sanctions on Russia.
The BRICS group aims to enhance economic and trade cooperation among its member states, expand the scope of exchange of goods, services, and investments, and reduce reliance on the dollar and Western financial systems by creating a unified currency.
China and Brazil signed an agreement to abandon the US dollar in bilateral trade, showing BRICS’ desire to reduce dependence on the dollar. BRICS, with over 3.2 billion people and a significant share of global GDP, has the resources to play a major role in the global financial system and international trade. The launch of the unified currency is expected to enhance BRICS’ position in the global economy and challenge dollar hegemony.
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