BRICS Strikes Back With A New Payment System | Set To Destroy The Entire Financial Order
BRICS Strikes Back With A New Payment System | Set To Destroy The Entire Financial Order
Tech Revolution: 10-11-2023
The BRICS countries, which include Brazil, Russia, India, China, and South Africa, are exploring the possibility of setting up their money transfer network.
This move could potentially rival the established SWIFT international payment system.
This revelation came from Russian Finance Minister Anton Siluanov, who shared this information during an interview with the TASS news agency last Thursday. During a conversation with journalists at the Moscow Financial Forum, Minister Siluanov highlighted that some BRICS members have already designed their personal payment mechanisms. He remarked, "We're currently working on launching our financial data transmission platform.
Various other BRICS nations either possess their systems or are in the process of making one. At the moment, this matter is up for dialogue.” The aim behind this initiative is straightforward. The BRICS economic group is seeking alternatives to the prevalent international payment systems.
They hope that by doing so, they'll facilitate and enhance trade exchanges among their member nations. Siluanov mentioned that this topic would be a significant point of discussion during next year's meeting, which will involve financial heads and administration officials from BRICS countries.
Over the years, BRICS nations have expressed concerns about American dominance in the global economic sphere, especially regarding the widespread use of the US dollar. They believe this has led to undue politico-economic influence, negatively impacting their economies.
In a bid to counteract this influence and promote more intra-bloc trade, these nations have been focusing on "de-dollarization." China, for instance, took a step in this direction by launching the Cross-Border Interbank Payment System back in 2015. This system's primary objective was to encourage the international use of the Chinese currency, RMB.
It's noteworthy that, as of now, over 4,200 banks across 182 different global territories and countries either use CIPS directly or indirectly through a secondary institution involved in their transactions.
The BRICS nations, striving for more financial independence and increased intra-bloc trade, are considering the development of a new payment network. Only time will tell how this will reshape the global financial landscape.
Following the earlier discussion on the BRICS nations' interest in establishing an alternative money transfer network, a new perspective has emerged. As the financial landscape undergoes shifts and transformations, prominent voices within the BRICS community, representing Brazil, Russia, India, China, and South Africa, have shed more light on their intentions and strategic moves.
Last month in Johannesburg, the BRICS summit witnessed candid conversations on this topic. Hosting the gathering, South Africa's finance minister, Enoch Godongwana, provided a clear stance.
Contrary to the widespread belief that BRICS aims to replace international payment systems like SWIFT entirely, Godongwana emphasized the bloc's objective: They intend to bolster trade using local currencies. By doing so, they hope to reduce dependency on dominant global currencies and fortify their economic autonomy.
Taking their commitment a step further, the leaders at the BRICS summit decided on a comprehensive plan of action. Over the next year, the finance ministers from each member country will delve deep into the intricacies of local currencies, their payment instruments, and platforms.
Once their analysis is complete, they will present their findings and recommendations. Parallelly, geopolitical tensions are rising due to the use of the US dollar in international relations. Russian President Vladimir Putin has openly criticized Western nations for manipulating the US dollar's strength.
He says that the West of leveraging the dollar's global significance to exert undue pressure on other countries, often leading to political and economic consequences.
Supporting this sentiment, in a recent dialogue between President Putin and Dilma Rousseff, the latter expressed similar concerns. As the leader of the China-based New Development Bank and the ex-president of Brazil, Rousseff voiced that NDB is exploring alternative currencies.
This initiative is deemed crucial, especially when the US dollar's influence is increasingly weaponized against various nations. More Details In The Video