In accordance with their ambition to exit the dollar, the BRICS are increasing the initiatives deemed useful to achieve these objectives. Essentially, this involves a certain questioning of the institutions that favor American hegemony. Following this logic, Russia, an influential member of BRICS, intends to present a new payment system which aims to undermine the SWIFT network.
BRICS want to move away from the current payment system
BRICS, the alliance of emerging economies made up of Brazil, Russia, India, China and South Africa, is poised to shake up the global financial landscape. Russia has announced that the organization will establish a new payment system which is its own. At the very least, a confirmation of news that had leaked for several months.
Unlike the existing SWIFT mechanism, this alternative will bypass the US dollar and settle transactions in local currencies. The initiative, which Russia intends to defend and propose to several countries, promises to reshape the dynamics of international trade.
The decision to develop a payment system independent of the SWIFT network, dominated by the United States, is in any case the sign of a significant change in global economic alliances.
By facilitating cross-border transactions in local currencies, the initiative aims to reduce dependence on the US dollar. This, by allowing BRICS and other developing countries to better control their financial and economic destiny.
A project that already has many people interested?
The latest news is that the initiative has garnered support from 20 countries. The latter would have committed to carrying out transactions in local currencies once the system was launched. With Russia proposing the concept to 159 countries in the South, Asia, Africa and Latin America, the potential impact on the global financial order cannot be underestimated.
By providing an alternative to SWIFT, BRICS aims to give countries the choice between using local currencies or the US dollar for international trade. This approach is part of the group’s broader agenda, which aims to foster multipolarity in global financial governance.
But we are still far from the adoption of this BRICS initiative. The choice of whether or not to opt for this project for a new payment system based on the Russian financial message transmission system (SPFS) is up to the countries approached.
Thus, by evaluating the pros and cons of such a system, the initiative could either strengthen or challenge the dominance of the US dollar in international trade. An uncertainty that highlights the possibility of a radical change in the global economic and monetary landscape.
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