Russia Says BRICS Developing Alternative Currency To US Dollar, As Combined GDP Is Higher Than G7

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Aleksandr Babakov, the Russian State Duma Deputy Speaker has said that Russia together with fellow BRICS members and other African countries are discussing the creation of a new global currency that could challenge the US dollar’s dominance and become analogous to the euro for non-Western states.

Babakov stated that having passed the test of Western sanctions, Moscow is ready to take on a new role in the world order and, together with partners, undermine the hegemony of the United States, outlining new trends in the international relations system. He pointed out that 49 of the 55 African countries all attended the Russia-African summit last week, while stressing that achieving real sovereignty for Russia and other countries would necessitate shifting away from the dominance of the US currency.

Moscow and its partners would need to agree on a new monetary unit and on the rules for its functioning, he explained.

When asked about the new currency, the Russian MP responded: “This is not the RMB Yuan and not the Ruble. There are already certain formulations… The name is not important, but it should be an analogue of the dollar.”

“After all, the BRICS in terms of its potential today is greater than the G7. That is, the potential of the market where this currency can function is very wide. There are no reasons to be tied to the dollar.”

The BRICS nations have been seeking to shift further away from the US dollar in mutual trade. The de-dollarization trend has been gaining momentum in the wake of sanctions that effectively cut Russia off from the Western-dominated financial system. Numerous developing nations – including fellow BRICS members China, India, Brazil, and South Africa – have also started to move toward alternative currencies in trade.

Moscow floated the idea of introducing a BRICS currency last year. President Vladimir Putin said last June that member states were working on developing a new reserve currency based on a basket of the national currencies used by the five-nation bloc.

In 2022, China’s trade with the BRICS nations reached about US$468 billion, Russia US$164 billion, while India achieved US$142 billion.

South Africa will host the XV BRICS Summit in Johannesburg, from 22 to 24 August, where the issue is likely to be highly discussed.

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