BRICS member Russia’s economy is thriving despite the US pressing sanctions since February 2022 for invading Ukraine. The country has bypassed the sanctions and began settling trade in local currencies. The Chinese yuan is now the most used currency for cross-border transactions in Russia and not the US dollar. The Russian ruble is also being heavily used for trade settlements helping its economy stay afloat even during sanctions.
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The sanctions on Russia are what led to BRICS kickstart the de-dollarization agenda around the world. The US Treasury Secretary Janet Yellen confirmed that de-dollarization gained steam after the sanctions on Russia. The alliance is looking to promote local currencies for trade to strengthen their native economies. Read here to know how many sectors in the US will be affected if BRICS ditches the dollar for trade.
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BRICS: Russia’s Economy Thrives Despite US Sanctions
The BRICS country Russia’s economy saw substantial growth in various sectors this year. Industrial production and military manufacturing experience a 3.3% increase in July. In addition, the GDP growth rate for the first half of the year spiked 4.6%, compared to 1.8% during the same period last year. All this growth was achieved even after a 9% decline in imports due to payment challenges.
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Unemployment in Russia is also at its record low at 2.4% in 2024. Russia’s robust economy was bolstered by significant private sector capital investments across all sections. The development indicates that the US sanctions are now doing little to nothing to hurt the economies of BRICS countries. In return, BRICS is getting united and stronger with Russia in its fight against the US.
This puts the US and other Western allies in limbo as Russia is dusting off the sanctions. BRICS members have been routinely doing business with Russia using local currencies for transactions in the last two years.