BRICS member China is leading all developing countries to fall under their ‘Belt and Road Initiative’ (BRI) for global trade. China launched the Belt and Road Initiative a decade ago to help finance developing countries build better infrastructure, ports, and railways, among others. The initiative is now a success as several countries received loans from China to build better infrastructure for trade. Developing countries now owe China $1.1 trillion in loans through the BRI initiative.
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China announced early this year that it would build a railroad from the Chinese city of Kashgar to Pakistan’s Gwadar port. The cost to build the railroad from Pakistan to China stands at a staggering $58 billion. BRICS country China said that the railroad to Pakistan will be built to reduce dependency on the West for trade.
Therefore, BRICS aims to end dependency on the US and the West for global trade and dominate the sector locally. Read here to know how many sectors in the US will be impacted if BRICS stops using the dollar.
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BRICS: 155 Countries Now Come Under the ‘Belt & Road Initiative’ With China
As of 2023, 155 countries signed the Belt and Road Initiative with China to better their chances of trading freely. The 155 countries constitute 75% of the world’s population and account for more than half of the world’s GDP. If BRICS launches a new currency and if China asks the BRI countries to repay the $1.1 trillion in loans in the new currency, the US dollar will slip into the path of a decline.
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China has not yet weaponized the Belt and Road Initiative but might use it over the years to challenge the US dollar. On the other hand, BRICS and ASEAN countries are advancing to dethrone the US dollar from the global reserve status.