BRICS countries are moving to replace the U.S. dollar with a new currency on the global stage to settle international trade. A recent report highlighted that 19 different nations have formally sent applications to join the BRICS alliance. The developing countries aim to dethrone the dollar from its global reserve status and create a new financial order. Around 5 Arab nations have shown their interest and are ready to join the BRICS bloc.
The five Arab nations that have formally requested to join the BRICS alliance are Saudi Arabia, the United Arab Emirates, Bahrain, Egypt, and Algeria. Furthermore, Iran, the powerful Middle Eastern nation, has also shown interest in joining the BRICS.
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Arab countries are rich in oil and gold reserves that may boost the BRICS alliance if allowed entry into the bloc. This could make the alliance of nations stronger and challenge the G7 countries. The G7 countries are developed nations compromising the United States, Canada, Germany, France, Italy, the United Kingdom, and Japan.
Therefore, the Arab nations showing interest to enter BRICS pose a threat to the G7 global order. Bloomberg reported that G7 nations could contribute approximately 27.8 percent toward the overall global economy. On the other hand, BRICS will make up 35 percent of the world’s economy.
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Arab Nations & The Quest For BRICS Alliance
The BRICS expansion could make the global financial order tilt towards the Eastern developing countries and not Western nations. The reliance on the U.S. dollar could come to a halt making its status in the global order thwarted. The dollar could tumble causing a financial catastrophe if it doesn’t find new ways to fund its deficit.
Saudi Arabia’s induction into the alliance could be the first step of the dollar losing its strength. The oil-rich nation could sell crude oil to Europe forcing them to settle the trade with the new BRICS currency. Saudi Arabia is the world’s largest oil exporter and several Western countries depend on its exports.
Also Read: Will Canada & Mexico Join BRICS To Eliminate U.S. Dollar’s Dominance?
In conclusion, Saudi Arabia’s entry into BRICS could spell doom to the U.S. dollar and the growth of G7 counties. The financial order is slipping away from the U.S. and going into the hands of developing Eastern nations.