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A group of major emerging countries is working on a way around the dollar — but they face an uphill battle to diminish the greenback’s dominance.
On Monday, Russian Foreign Minister Sergey Lavrov said BRICS countries are developing a payments platform that will allow them to bypass the US dollar, per TASS, a state news agency.
The initiative came from a summit of the BRICS countries in Johannesburg last year where the group — which includes the key members of Brazil, Russia, India, China, and South Africa — called for more trade and lending in their national currencies.
Lavrov said on Monday that the platform will improve the international monetary system and allow payment in national currencies for mutual trade. Russia is keen to move its trading partners away from the dollar because it faces significant sanctions from the US and its allies.
Details on the platform are scarce, including which countries could use it and when it could be adopted.
Lavrov was speaking at the two-day BRICS Foreign Ministers Meeting, just days after Russia’s flagship St Petersburg International Economic Forum. There, Russian President Vladimir Putin doubled down on his call to phase out the use of the US dollar and other “toxic” currencies.
There may be more traction on this front when the BRICS bloc meets in Kazan, Russia from October 22 to October 24, according to Christopher Granville, the managing director of global political research at GlobalData TS Lombard.
The new BRICS payments system could come in the form of a digital-currency system that allows for central banks to deal with local currency transactions directly, Granville wrote in a May report.
Lavrov himself touted a digital-currency-based settlement system to local media in April. — Business Insider Africa.
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