The summit is set to be attended by presidents from two dozen nations. In their opinion, this is the most significant event Russia has held for many years and is a message to the West amid wars in Ukraine. The annual BRICS currency summit began on Tuesday and is being held in Kazan, Russian President Putin’s hometown.
The three-night conclave will be Russia’s largest gathering of world leaders in over two decades. Moreover, it comes at a time when the Kreim is embroiled in a war on Ukraine backed by Western nations.
What is BRICS?
BRICS globally refers to Brazil, Russia, India, China and South Africa.
The group started in 2006, and Brazil, Russia, India, and China convened for the first BRIC summit in 2009. A year later, South Africa was included as well. The alliance’s aim is to counteract the West’s economic and political monopoly. The group sets priorities and has discussions once every year during the ensuree summit, which all members host in turn.
In 2023, BRICS reached the international forum to call Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates after they applied to join the club. So far, Saudi Arabia transfers have grown formally; the others have been achieved.
New BRICS Currency
No announcement was made about launching a new BRIC currency at the 2023 BRICS summit. It was hosted in South Africa; however, this topic has been debated for a long time in several BRICS forums. In the BRICS, diverse local currencies hinder smooth trade among member states. Except for Russia, all current members possess separate local currencies. It is rational to have a single currency for trade and other reasons.
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When Will Brics Currency Be Released?
There were speculations that this new Brics nations currency would be launched at the next conference of BRICS, scheduled for 2024. Still, during an interview, former Russian diplomat Yury Ushakov opened up on the issue of BRIC currency. He presented for discussion BRICS Pay, which is a payment system built around blockchain technology, though BRICS has not officially launched it.
The BRICS nations, particularly China, have been on a gold-buying spree. Therefore, there is speculation that the BRICS currency will be gold-backed. This common nations currency will facilitate international trade and transactions and be usable by national and domestic businesses.
Is the U.S. Dollar In Trouble?
For the first time, BRICS leaders have expressed their intentions to use more national currencies than the dollar. Since last year, Brics nations currency value has increased due to the Fed’s interest rate hikes and the Russia-Ukraine war, which made dollar debt and numerous imports expensive.
On the 22nd of February, when it became clear that Russia would be sanctioned, people began to wonder whether the East would move away from the dollar.
“The momentum of the de-dollarization process, which is systemic due to the current development, has been getting faster,” Putin said at the summit on Tuesday.
The dollar remains the primary currency for most international trade. As of 2017, 88% of all global currency trade involved the dollar, as evidenced by the Bank of International Settlements Data.
The shift towards de-dollarization is not simple. It necessitates the compliance and independent decisions of every currency trader, lender, and borrower from nations across the globe to transition to another currency. The potential impact of this transition cannot be overstated.
What’s Next For BRICS Nations Currency
South American countries expressed interest in joining the “BRICS” countries, not Southeast countries. Russia made a case for Southeast Asian countries to join BRICS. A little later, Turkish President Erdogan met with President Xi Jinping and remarked about Turkey’s interest in joining BRICS. However, it’s been months since we last heard of Indonesia, the Philippines, or other Southeast Asian nations making formal requests to join the bloc.
