BRICS nations are advancing to create a new currency sidelining the U.S. dollar on the international stage. The dollar’s global reserve status could be challenged when the new currency launches and threaten America’s economy. Therefore, the U.S. dollar stands at a pivotal point in a make-or-break situation for its global existence. A total of 25 countries have shown interest in joining BRICS and accepting the new currency for cross-border transactions.
BRICS Currency: What Does It Offer That the U.S. Dollar Doesn’t?
- The first thing that the U.S. dollar doesn’t offer to the world is security.
The U.S. dollar comes with a risk of debt, as the United States could default on its $31.46 trillion federal debt. A debt default could create havoc not only in America but in all countries holding billions of dollars in reserve. The debt default could destabilize developing nations’ economies making local businesses suffer for the mistakes of the U.S. Federal Reserve.
2. The second thing that the U.S. dollar doesn’t offer is ease of business.
The U.S. imposing sanctions on developing nations is the reason why the BRICS alliance decided to launch a new currency. Developing Eastern nations face economic hurdles when the U.S. presses sanctions closing all options to do business with the world. The U.S. Treasury Secretary Janet Yellen confirmed that sanctions will hurt America going forward and not the other way around.
3. The third and final thing is that the U.S. dollar doesn’t offer is ‘native’ economic strength.
When the world settles cross-border transactions using the U.S. dollar for trade, America funds its deficit. The native currencies of the developing nations stand no chance of strengthening as their tender is never put to use.
Trading with a new BRICS currency or their native currencies will boost their economies and end reliance on the dollar. In conclusion, the developing nations will go on a path of self-dependence reshaping their native economies according to their ideals.