Arrr, me hearties! The likes o' China and Russia be plannin' to oust the mighty US dollar and bring chaos to the seas of global trade!
2023-08-21
Arrr, me hearties! The brave China, Russia-led BRICS crew be plannin' to challenge the mighty U.S. by creatin' a newfangled currency, apart from the dollar. This ragtag bunch, includin' Brazil, India, and South Africa, be settin' sail to meet this very week.
The BRICS bloc, consisting of Brazil, Russia, India, China, and South Africa, is aiming to challenge the dominance of the U.S. dollar. The group is seeking to establish a new international currency that would replace the dollar as the premier currency of international reserves and medium of exchange. This move towards de-dollarization has gained momentum due to the "weaponization" of the U.S. dollar by the U.S. government, which uses economic sanctions as a tool to impose its political will on other countries. Many non-Western countries are eager to join BRICS in order to reduce their dependence on the dollar and bypass U.S. sanctions if necessary. More than 40 countries, including U.S. allies and foes, have expressed interest in joining the bloc. However, the threat to U.S. economic hegemony may not be as real as Moscow and Beijing want to portray it. The dollar still dominates global trade, with 88% of international transactions conducted in dollars. To challenge the dollar's dominance, credibility and the rule of law are necessary, qualities that are lacking in Russia and China. It is unlikely that the dollar will be supplanted as the dominant global reserve currency in the near future, but Washington should not ignore the trend of de-dollarization. BRICS is a significant economic and geopolitical bloc, and its expansion is a result of Washington's misguided policies. Trust and the rule of law were the factors that attracted global market participants to the dollar in the first place, and the U.S. should remember this when considering further actions against Russia or any other country.