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Spotlight on potential BRICS currency as pushback against US dollar grows

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challenged the US dollar’s role as the world’s primary reserve currency for global trade.

Ramaphosa, while seconding Lula’s comment, said that the “issue of currency” would be discussed at the upcoming meeting of BRICS countries later this year, which South Africa is scheduled to host in August.

Russia’s interest in a common BRICS currency

Since the beginning of the war in Ukraine, Moscow has ramped up its efforts to promote de-dollarisation. Immediately after President Vladimir Putin announced ‘special military operations’ against Ukraine, Washington froze half of Russia’s foreign currency reserves and banned its biggest banks from the SWIFT international payments system.

Since February 2022, Russia has been pushing for de-dollarisation in consonance with China and nations deemed neutral in the wake of the ongoing Ukraine war.

Alexander Babakov, the deputy chairman of Russian parliament, the State Duma, while speaking at the St. Petersburg International Economic Forum event in New Delhi, India, in April 203 had said that the plan is to initially transition to using domestic currencies in transactions.

Following this, the introduction and circulation of a digital or an alternative form of currency could be explored.

Brazil, Russia, India and China established BRIC in 2009 and the bloc became BRICS a year later when South Africa was admitted.

If it expands to include other “emerging nations with persistent surpluses,” a globally fairer, multi-currency global system could emerge, O’Neill said.

The bloc represents about 26.7 per cent of the world’s land surface and 41.5 per cent of the global population.

The BRICS countries hold a substantial 16 per cent share in world trade and over the years, they have played a vital role as engines of global economic growth.

Source: WION

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