by News Desk

March 31 2023
from TheCradle Website

(Photo Credit: Twitter/ @EVILSAGAGemini)




The US dollar's hegemony

in international markets

continues to deteriorate partly due to

the Global South's refusal to enforce

western sanctions against Russia...

The Deputy Chairman of Russia's State Duma, Alexander Babakov, said on 30 March that the BRICS bloc of emerging economies,

Brazil, Russia, India, China, and South Africa, working on developing a "new currency" that will be presented at the organization's upcoming summit in Durban.

"The transition to settlements in national currencies is the first step. The next one is to provide the circulation of digital or any other form of a fundamentally new currency in the nearest future.


I think that at the BRICS [leaders' summit], the readiness to realize this project will be announced, such works are underway," Babakov said on the sidelines of the Russian-Indian Strategic Partnership for Development and Growth Business Forum.

Babakov also stated that a single currency could likely emerge within BRICS, and this would be pegged not just to the value of gold but also to,

"other groups of products, rare-earth elements, or soil."

BRICS member states account for more than 40 percent of the global population and around a quarter of the global GDP.


In recent months, the group has been positioning itself as the Global South's alternative to the G7 group of nations.


Several nations in West Asia and North Africa have expressed interest in joining the bloc, including Saudi Arabia and Algeria. Last year, Iran officially applied to join BRICS.


Earlier this month, South African Foreign Minister Naledi Pandor revealed that global interest in BRICS is "huge," adding that she had 12 letters from interested countries on her desk, including,

  • the UAE

  • Egypt

  • Argentina

  • Mexico

  • Nigeria...

The news of a possible BRICS currency comes as a growing number of nations across the world are moving away from conducting trade in US dollars as a result of Washington's policy of economic coercion.


This week alone, the ASEAN group of nations discussed dropping the,

  • US Dollar

  • Euro

  • Yen

  • British Pound,

...from financial transactions and instead moving to settlements in local currencies.


Similarly, Brazil - the largest economy in Latin America - reached an agreement with China to enable import and export transactions between both nations to take place without using the US dollar.


Former Goldman Sachs chief economist Jim O'Neill this month called on BRICS to expand and challenge the greenback's dominance, highlighting that Washington's economic hegemony destabilizes other nations' monetary policies.

"The US dollar plays a far too dominant role in global finance," he wrote in a paper published in the Global Policy journal.


"Whenever the Federal Reserve Board has embarked on periods of monetary tightening, or the opposite, loosening, the consequences on the value of the dollar and the knock-on effects have been dramatic."


BRICS set to...

Surpass G7 in Economic Growth

by News Desk

April 19 2023
from TheCradle Website




(Photo Credit: William Potter/Shutterstock)




The latest IMF figures

reveal that BRICS nations will contribute

32.1 percent to global growth,

compared to the G7's 29.9 percent...


The member states of the BRICS group, which include Brazil, Russia, India, China, and South Africa, are expected to surpass the US-led G7 states in economic growth expectations, according to a Bloomberg report.

Bloomberg estimates that,

the BRICS nations will contribute 32.1 percent of global growth, compared to the G7's 29.9 percent, based on the most recent IMF figures...

According to the Bloomberg analysis, the G7 and BRICS nations each contributed equally to global economic growth in 2020. The western-led bloc's performance, however, has since declined.


The G7 is expected to make up just 27.8 percent of the global economy by 2028, while BRICS will make up 35 percent.

"In total, 75 percent of global growth is expected to be concentrated in 20 countries and over half in the top four: China, India, the US, and Indonesia.


While Group of Seven countries will comprise a smaller share, Germany, Japan, the United Kingdom, and France are seen among the top 10 contributors," Bloomberg reports.

The report comes as BRICS has been receiving more and more interest from other states wanting to join.

Russian Foreign Minister Sergei Lavrov has said that "more than a dozen" countries have shown interest in joining BRICS this year, including,

  • Algeria

  • Argentina

  • Bahrain

  • Bangladesh

  • Egypt

  • Indonesia

  • Iran

  • Mexico

  • Nigeria

  • Pakistan

  • Sudan

  • Syria

  • the United Arab Emirates

  • Turkey

  • Venezuela...

Other countries such as,

  • Bangladesh

  • Egypt

  • Saudi Arabia,

...have acquired equity in the BRICS' New Development Bank.


The US Dollar has become more unreliable for dollarized economies due to rising interest rates regulated by the US Federal Reserve (FED) and the bank's weaponization of the dollar through financial sanctions.


In addition,

the west, especially Europe, is facing a growing energy crisis resulting from sanctions targeting Russian energy markets due to its 'invasion' of Ukraine and the US sabotage of the Nordstream pipeline.


Germany has also begun to shut down its remaining nuclear power plants.

In January, Lavrov said that,

the BRICS countries will discuss creating a common currency at the group's upcoming summit this August.

Referring to the current US dollar-dominated international financial system, which exposes participant countries to the threat of economic sanctions imposed by Washington, Lavrov claimed that,

"serious, self-respecting countries are well aware of what is at stake, see the incompetence of the 'masters' of the current international monetary and financial system, and want to create their own mechanisms to ensure sustainable development, which will be protected from outside dictates."

On 13 April, Brazil's President Ignacio Lula da Silva called on the member states of BRICS and countries that seek to become part of it to replace the dollar in foreign trade.

"Every night, I ask myself why all countries have to base their trade on the dollar," he said, adding the question, "Why can't we do trade based on our own currencies."