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M. A. Javed
The debate on the BRICS Currency and expansion is getting
momentum, particularly after the inclusion of six new member declared at the
BRCIS Summit 2023. The bloc then welcomed Argentina, Egypt, Ethiopia, Iran,
Saudi Arabia, and the United Arab Emirates. Now the world is eying at the BRICS
Summit 2024 as to whether the BRICS Currency will be released or not.
BRICS consistency on the shared economy, de-dollarization and
examples of trading in local currencies have raised expectations in this
regard. In addition, BRICS expansion and bulk of applications for its membership
by many states have made the bloc more important in global politics and
economy.
BRICS Economic Ascendance in 2023:
The bloc accounts for Combined GDP of more than $23 trillion.
The BRICS nations host 42% percent of the world population. The economies of its
members are continuously increasing with China leading and India as the
potential economic powerhouse.
Expansion Efforts and Six-Nation Addition:
The six-nation expansion announced in 2023 have expanded the
Bloc’s sphere of influence in Middle East and Africa. Therefore, potential for BRICS
currency has increased further. It is being speculated that growth of the
alliance will have a great impact on the global economic landscape.
De-Dollarization Plan and Unilateral Trade:
Since the BRICS nations are actively pursuing the alternate
mechanisms for global trade and economic systems, the dollar currency is facing
imminent threats of de-dollarization. As BRICS members are continuously advocating
their stance on diversifying global reserve currencies with emphasis on
reliance of their own domestic currencies.
In this regard, various initiative has been taken like the announcement
of New Development Bank and Contingent Reserve Arrangement. This provides a
viable alternative to IMF and World Bank.
Furthermore, some BRICS countries have started unilateral
trade due to strict Western sanctions. This could potentially strengthen the
economic ties within the bloc and foster greater protection from external pressures.
In the August statement about the BRICS currency, the bloc
stated that “such a currency increases our payment options and reduces our
vulnerabilities.” Moreover, “it presents a clear path away from the greenback
throughout their trade dealings.”
Despite of some challenges the ongoing year may bring some constructive news and statements from the leadership of bloc. So, expect something bigger in BRICS Summit 2024.
The writer has expertise in the field of International Relations
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