BRICS, the association of five major emerging economies – Brazil, Russia, India, China, and South Africa, is making strategic moves to reshape the global financial order. Their goal is to diminish the longstanding dominance of the US dollar and establish a more equitable world financial system.
Putin’s Critique and BRICS’ Ambitious Plans
Russian President Vladimir Putin, at the forefront of this initiative, criticized the US and Western allies for imposing a “rules-based world order.” He anticipates significant changes following the 16th BRICS summit in 2024, hosted in Russia’s Kazan region.
BRICS Aiming for ‘Fair World Order’
Putin emphasized BRICS’ commitment to forming a “fair world order” to counter American hegemony. He highlighted the inadequacy of current rules that change according to the political agenda of dominant powers. The 16th BRICS summit is expected to be a showcase of the alliance’s strength and unity in promoting a balanced global financial system.
The Rise of a New BRICS Currency
BRICS is not only aspiring to end the reliance on the US dollar but also exploring the creation of a new BRICS currency. This move could significantly alter the dynamics of international trade and weaken the dollar’s role as the global reserve currency.
Impact on the US Economy and Sectors
The possible shift away from the US dollar by BRICS could profoundly impact various sectors of the American economy. Key areas like banking, finance, energy, international trade, and tourism might experience a ripple effect, leading to potential financial instability.
A Domino Effect on US Financial Markets
Should BRICS successfully transition to using local currencies for cross-border transactions, it could trigger a domino effect across multiple sectors in the US. This change could lead to increased prices and even hyperinflation, posing a significant challenge to the US economy.
BRICS’ bold steps towards establishing a new financial order represent a pivotal moment in global economics. By challenging the dominance of the US dollar and advocating for a fairer financial system, BRICS is poised to reshape international trade and currency dynamics. The upcoming 16th BRICS summit will be crucial in determining the future course of these efforts and the potential repercussions for the US and global economies.
