BRICS Ambition to Dethrone U.S. Dollar Remains To Be ‘Long-Term’ Goal

Vinod Dsouza
Chinese Yuan US Dollar BRICS Currency

China and Russia are the driving force behind the BRICS alliance that aims to topple the U.S. dollar’s global supremacy. India remains on the sidelines and is skeptical of China’s power prowls for world domination. Just recently, India’s External Affairs Minister S. Jaishankar hinted that the country could back out from creating a new BRICS currency.

Jaishankar stressed that India is committed to strengthening its native currency, the Rupee, and not a new tender. Read here to know why India is worried that China and Russia are using the BRICS bloc for their self-interest.

Also Read: BRICS: 130 Countries Move Towards CBDC Currency, US Dollar in Jeopardy

BRICS Has a Long-term Goal to Topple the U.S. Dollar

Source: Tutwa Consulting Group

While the BRICS bloc will decide on the formation of a new currency in August, the new tender might or might not dethrone the U.S. dollar. More dynamics come into play as the BRICS tender will not be backed by other leading currencies.

The new currency needs to sustain the whiplashes of the foreign exchange markets and gain the trust of the world economy. Therefore, the BRICS currency taking on the U.S. dollar is not as easy as said and done.

Also Read: 41 Countries Ready To Accept BRICS Currency a Month Before Summit

Nonetheless, even if the BRICS currency fails, China and Russia have long-term goals to take on the U.S. dollar. The duo aims to create a currency that rivals the dollar in its quest to capture the global financial markets.

US dollar

“The development of anything alternative is more a medium to long-term ambition,” said Leslie Maasdorp, VP of New Development Bank to Fortune. Therefore, if the short-term goal fails, China and Russia could equip themselves with new plans to dethrone the U.S. dollar.

Also Read: 8 Financial Sectors To Be Affected if BRICS Launch New Currency

Whether the soon-to-be-released BRICS currency or another new tender will survive or perish, only time will tell. Until then, the U.S. dollar reigns supreme and is the most used currency for all cross-border transactions. The greenback is also the strongest currency available at this point and is ahead of all global currencies combined.