As the BRICS economic alliance continues to implement its own de-dollarization efforts, more than $70 billion in trade will no longer be settled in US dollars. Indeed, the bloc is set to implement a landmark trade agreement. Specifically, they will seek to decrease reliance on the greenback in unilateral trade.
The agreement will see the BRICS alliance completely ditch the dollar as a trade currently. Alternatively, they will rely on local currency settlement to fuel a greater shift in global finance. Not only will this new change affect all 9 alliance members, but six additional countries as well.
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BRICS Trade Agreement to Have Massive Effect on US Dollar Prevalence
The last several years have seen a notable transformation in global finance. Specifically, geopolitics have targeted Western dominance in the sector. That task has been led by the BRICS collective. Their de-dollarization efforts have been growing since the bloc’s most recent expansion in 2023.
However, those efforts are set to magnify this year. A new trade agreement with the BRICS alliance will see $70 billion in trade no longer be settled in the US dollar. Data shows that Kazakhstan’s trade with the BRICS collective reached the figure last year. Now, those settlements will all be done in local currencies.
Kazakhstan was one of the countries that signed the BRCIS trade agreement. Subsequently, their trade with the bloc, which grew 55% in 2023, is set to no longer rely on the greenback. Additionally, its unilateral trade dealings are only set to increase over the course of 2024.
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This is but one country in a plethora of nations that trade with the alliance. Therefore, the ultimate effect of abandoning the Western currency should be even more expansive. Moreover, the upcoming summit should see even more countries joining the group.
Nations across the globe have clearly expressed their interest in joining the bloc. As many as 30 have reached out, with several invitations expected to be granted this year. Those developments should continue to reestablish the global order.