BRICS is trying to diminish the power of the US dollar on the global stage with various new initiatives. The de-dollarization efforts gained steam last year after the alliance started convincing developing countries to trade in local currencies. The idea is to put local currencies ahead for cross-border transactions and strengthen their native economies.
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The development gives local currencies a boost while the US dollar will be sent on the path of decline. Read here to know how many sectors in the US will be impacted if BRICS completely ditches the dollar for trade.
BRICS: ‘Days of the US Dollar-Centric World is Over’, Says Ambassador
South Africa’s BRICS Ambassador Anil Sooklal said that the days of the US dollar-controlled world will soon end. He explained that the world will soon embrace the realities of a de-dollarized world. He argues that the US government’s “weaponization” of the dollar no longer holds value in the global markets.
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Just recently, Russia bypassed the US sanctions by passing a legislature to use digital financial assets (DFAs) for global trade. The US dollar will no longer be required to settle cross-border transactions in Russia if implemented. BRICS could follow a similar strategy and dim the prospects of the US dollar after the next summit.
“The days of a US dollar-centric world is over. That’s a reality,” said Sooklal. The Ambassador added, “We have a multipolar global trading system today,” indicating the US dollar days could soon be over.
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BRICS is looking to create a multipolar financial world where the US dollar will not have any prominence in trade. The bloc aims to keep local currencies at the forefront and keep the US dollar payment in the back seat. The 16th summit in October this year will provide more clarity about how they plan to strengthen their local currencies.