BRICS Bank: Will it Use the US Dollar in 2024 To Pay Debts?

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brics new development bank ndb
Source: NDB

The China Development Bank launched the New Development Bank (NDB) with BRICS to challenge the U.S. dollar. In 2024, the mission of de-dollarization lives on, and BRICS and its bank are actively working on projects that don’t involve the greenback. However, with all these projects comes debt, and some may wonder if the BRICS Bank would ever find itself in enough debt to have to avoid local currencies and instead bring back the US Dollar.

In January 2024, the BRIC bank announced a plan to raise $3 billion in local currencies in the next five years. Typically, the BRICS bank looks to help emerging economies that need boosts in finance. In turn, this disburses cash to those local countries who support BRICS. Back in 2023 though, the NDB found itself dealing with debt, and it was reported that it needed to turn back to the US dollar to fix this.

Also Read: BRICS Passes G7 in GDP (PPP) to Become More Powerful in 2023

BRICS Bank New Development Bank NDB US Dollar
Source: businesstoday.in

On the other hand, with the mission to ditch the US dollar still prominent, the BRICS bank is taking all measures to not return to a period of debt like it did last year. The expansion of BRICS back in August 2023 was a major help for this. In particular, the addition of rich nations such as the UAE and Saudi Arabia provides extra financial backing for the NDB.

BRICS Bank to Launch Majaraja Bond

Vladimir Kazbekov, the Chief Operating Officer of NDB, said that the bank is preparing to launch its maiden bond. The new BRICS bond will be called the Maharaja Bond and aims to receive investments in local currencies, equaling around $28 billion. Therefore, the BRICS bank NDB is sidelining the US dollar while raising funds and offering bonds worth billions of dollars.

Also Read: Ethiopia Gets a Difficult Start in BRICS

Furthermore, the NDB does well in creating long-term loans in developing nations’ local currencies instead of the US dollar. Since these pipelines of transaction aren’t subject to US sanctions, this helps push BRICS’ long-term mission of ditching the US dollar. Therefore, the BRICS bank will likely avoid relying on the US Dollar throughout 2024 to pay any debt.