BRICS Ministers Discuss Need for New Single Currency Amid De-Dollarization
A whole array of countries, including Iran, Venezuela and Saudi Arabia, have already signaled an interest in joining BRICS, which currently comprises Brazil, Russia, India, China and South Africa.
SputnikBRICS member states have been briefed on the potential use of alternative currencies to shield the group's New Development Bank from the impact of sanctions.
The issue topped the agenda of BRICS' ministerial meeting in Cape Town, South Africa on Thursday as participants discussed how the bloc could win greater global influence and challenge the US.
The foreign ministers from Brazil, Russia, India, China and South Africa also discussed plans on
admitting new members to the organization. The top South African diplomat,
Naledi Pandor, stressed that more work was needed to make such admission possible, voicing hope that a relevant report would be ready by August, when a BRICS summit will take place.
Chinese Vice Foreign Minister
Ma Zhaoxu in turn made it clear that his country was happy about
more countries possibly joining BRICS as it would expand the bloc's clout and give it more power to serve the interests of developing countries.
The BRICS bloc "was inclusive ... in sharp contrast to some countries' small circle, and so I believe the enlargement of BRICS will be beneficial to the BRICS countries," Ma pointed out.
He spoke as Russian Foreign Minister Sergey Lavrov said that "with regard to the issue of BRICS, it is still being shaped, it is still evolving."
"BRICS is a new organization based on the principles of equality, mutual respect, consensus, non-intervention and strict adherence to the UN Charter in all its principles and in all their relationships. BRICS does not choose which principle it likes for a particular situation, and it then doesn't do the opposite," Lavrov underlined.
The Russian foreign minister added that the bloc "symbolizes the evolution of the multipolar world, which is being discussed more and more often" amid interest in joining BRICS from a spate of countries.
The remarks came after Anil Sooklal, South Africa’s envoy to BRICS, said last month that a total of 19 countries are interested in becoming the group’s members and that Saudi Arabia and Iran are among the countries who’ve formally asked to join.
Other countries that have expressed an interest in entering include Argentina, the United Arab Emirates, Algeria, Egypt, Bahrain and Indonesia, along with two nations from East Africa and one from West Africa — which Sooklal didn’t identify. Since its formation in 2006, the group has only added one member – South Africa - in 2010.
BRICS' Push for De-Dollarization
The BRICS ministerial meeting followed South Africa's Foreign Minister Naledi Pandor saying earlier this month that amid a growing chorus of voices raising the need for using alternatives to the dollar in global trading, BRICS member states will continue to discuss the introduction of a common currency.
Pandor was echoed by Russia's State Duma Deputy Chairman Alexander Babakov, who earlier did not rule out the possibility of a single currency emerging in BRICS, which he said could be secured not just by gold, but also by other groups of products, such as rare-earth elements.
"I think that the BRICS [leaders' summit in August] will announce the readiness to realize this project," Babakov pointed out.
The same tone was struck by Sergey Lavrov, who told reporters last month that BRICS countries "have long been working on measures to reduce the share of the dollar in mutual payments and to switch to payments in national currencies […]".
He added that “recently, Brazilian President [Luiz Inacio] Lula da Silva suggested that we consider moving toward a collective currency within the BRICS. We will participate with interest in this discussion."
Lavrov spoke after da Silva urged BRICS nations to come up with an alternative to replace the dollar in foreign trade.
"Why can't an institution like the BRICS bank have a currency to finance trade relations between Brazil and China, between Brazil and all the other BRICS countries? Who decided that the dollar was the (trade) currency after the end of gold parity?" Lula said during a visit to the Shanghai-based New Development Bank.
This was preceded by Lavrov stating that BRICS member states are already actively working on increasing payments in national currencies in mutual trade and financial operations due to the unreliability of the US dollar.
"The share of national currencies in settlements between the BRICS countries is already rapidly growing. The BRICS countries have initiatives that address the need to work on the creation of their own currency. The reason is very simple: we cannot rely on mechanisms which are in the hands of those who can cheat at any time and refuse to fulfill their obligations," Lavrov told reporters.
In this vein, Russian expert Mikhail Khazin told Sputnik that the "inevitable" process of de-dollarization had been facilitated by Washington's sweeping sanctions against major global players, including Russia, and the use of the dollar as a "punishing" mechanism.
By freezing Russian Central Bank assets, severing the nation from the SWIFT payment system, and prohibiting exports of US dollar-denominated banknotes to the country, Washington had sent an ominous signal to other world players, Khazin underscored.