As 2024 marches on, the BRICS alliance, with its grand plan to kick the US Dollar to the curb, is stirring up quite the storm among financial experts. Some are outright predicting a fiasco. Imagine a finance minister stepping up and saying this whole ditch-the-dollar idea is a box of dynamite for both the BRICS countries and others still finding their feet.
Zimbabwe’s former financial minister, Tendai Biti, is pretty much a prophet of doom about the whole situation. He’s telling Zimbabwe’s President Mnangagwa to steer clear of the BRICS’ playbook. According to Biti, dumping the dollar could drag Zimbabwe, eyeing a spot in the BRICS lineup in 2024, into an economic crisis. “This move will be an absolute disaster and will cost workers and pensioners,” he points out, adding that dreaming of local currencies taking over the global stage is just that—a dream.
Biti’s not alone in thinking the BRICS big shots might weather the storm without the Dollar, but he’s not betting on the same fate for the smaller guys. Zimbabwe’s economic struggles, particularly with its own currency, highlights the risks. Biti suggests that while the BRICS New Development Bank throws a lifeline, abandoning the Dollar could be a gamble too risky to take.
If smaller nations hitch their wagon to BRICS’ de-dollarization crusade, they’re playing a dangerous game. Without the Dollar’s cushion, launching into a world where BRICS currencies reign supreme seems premature. And with the US Dollar’s long reign as the world’s go-to currency, replacing it appears a Herculean task, one that might leave global trade gasping for air.
Meanwhile, a brand-new payment system powered by blockchain, courtesy of the BRICS brain trust. Kremlin aide Yury Ushakov spilled the beans about this leap towards cutting the Dollar loose, potentially shaking up its global reserve currency status. This system, Ushakov envisions, will be a breath of fresh air—efficient, politics-free, and yep, Dollar-free.
But details? Sparse. What Ushakov did stress, though, is BRICS’ ambition to pump up its volume in the world’s monetary and financial system’s mixtape. With heavyweights like Brazil, Russia, India, China, and South Africa, and newcomers Egypt, the UAE, Iran, and Ethiopia, BRICS isn a coalition with a staggering population and a heavyweight economic punch, eager to lessen its Dollar dependency.
The plot thickens with Brazil’s President Luiz Inacio Lula da Silva rallying the troops for a BRICS currency, aiming to diversify trade and investment dealings. China and Brazil already made waves with a trade agreement in their own currencies, sidestepping the Dollar. Following suit, India and the UAE executed an oil deal without the Dollar.
Anil Sooklal, the BRICS bloc’s voice from South Africa, laid it out flat before last year’s summit: the Dollar’s days of world domination are numbered. Welcome to the era of a multipolar global trading system, where the BRICS alliance could very well lead the charge into uncharted financial waters.
