Over the last year, the BRICS alliance has been working to develop its own native currency. Now, the final result of that work is nearing, as it could be poised to be a global financial game changer in 2024.
Both Russia and Iran confirmed collaboration on a BRICS currency project earlier this month. That confirms the consistent rumblings about such an endeavor that first began prior to the 2023 Annual Summit. With the arrival of the currency likely slated for this year, global finance may be set to face monumental changes.
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Will the BRICS Currency Debut in 2024?
The last several years have seen the BRICS alliance dominate geopolitical discourse. The collective has firmly embraced its competitor with Western powers as it seeks a multipolar world. Moreover, it has proven the viability of that plan with its significant expansion initiatives.
However, that has not been the primary focus of the alliance over the last year. Alternatively, the grouping has sought to decrease international reliance on the US dollar. That desire has been met with increased de-dollarization efforts and discussions on the creation of a native BRICS currency.
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This month, Iranian officials confirmed that the country was collaborating with Russia on such a project. The BRICS expansion nation and Moscow were working together to develop one currency to be used by all member nations in unilateral trade dealings.
The group had referenced the project for much of the last year. Additionally, the creation of the BRICS Pay system has only facilitated greater intrigue in the currency’s release date. Therefore, it is likely that the project will be unveiled at the 2024 Annual Summit in October.
2023’s Summit was the setting for the bloc’s monumental expansion announcement. Now, it should prove to be the place where the bloc finally announces its native currency. Furthermore, that currency should have massive implications for the global economy as a whole.
What it Means for the Global Economy
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The intention behind the creation of a BRICS currency is undoubtedly to rival the international reliance on the US dollar. It is that purpose that should bring about notable changes to the overall global finance sector.
The presence of such a currency provides nations with a different trade settlement asset. Indeed, it grants a way for many smaller nations to avoid utilizing the Western currency. Its mere existence creates increased diversification in global economics and benefits those nations.
As those BRICS nations embrace this currency, its role on a global scale will only be maximized. As nations facilitate trade dealings with prominent economic mainstays like China and Saudi Arabia, they will be pushed to utilize their newfound currency.
The long-term prospects for the US dollar are greatly threatened by its creation and implementation. Although it will face an acquisition curve, the coming years should see the currency continue to alter how countries facilitate trade dealings. As the bloc expands, the web of users will grow, and shift the overall currency power balance.