Today, within the Eurasian Economic Union, economic transactions are settled with national currencies that now eclipse the dollar. Likewise, most economic exchanges involving Russia are carried out with the ruble. The euro and the dollar are being squeezed out. This change in the global financial landscape cannot go unnoticed. The possibility of the emergence of a common commercial currency within the BRICS is coming back to the center of debate. In a recent interview, Sergei Glaziev, Russian economist and politician, drops the bomb: the common BRICS currency is inevitable. Details.
BRICS: on the way to redefining the terms of the global economy?
In recent months, the proactivity of the BRICS seems to confirm the predictions relating to the creation of a common currency within the bloc. In his interview, the Russian economist, Sergei Glaziev, claimed that we are moving towards an era where the global economy will be dominated by a new currency, that of the BRICS.
It refers, among other things, to the volatility of exchange rates, the instability and unpredictability of the current global economic system, the economic sanctions imposed by Western powers, etc. According to the Russian economist, the combined BRICS nations have the material capacity to redefine the terms of global trade.
Indeed, he justifies, in terms of creating a common currency, the BRICS member countries will not have to start from scratch. He points out that they already have a suitable conceptual framework and a wide range of raw materials.
Sergei Glaziev specifies, however, that the BRICS currency will not replace the dollar. For him, the BRICS currency will fill the void created by the decline of the hegemony of the dollar. It will be the new unit of account used for settlements on a global scale.
The technical difficulties of carrying out the project
While it is true that a common currency would be an ambitious project for BRICS dominance, the path to its realization may be more than it seems. Indeed, the BRICS are a meeting of economies of different sizes and operating with varied monetary policies.
Additionally, decisions within the bloc can only be made by consensus. The plans to enlarge the bloc which recently welcomed five new members could therefore slow down decision-making on subjects as sensitive as a common currency.
Perhaps Vladimir Putin, who currently holds the presidency of BRICS, has already developed a plan to resolve the issue. He made it known on the 15the BRICS Summit that “the inevitable move towards dedollarization of economic ties within BRICS is accelerating.” So, wait and see!
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