Evgeny Goryunov and Kirill Chernovol on the outlook for BRICS abandoning the US dollar

Despite the discussions, there are no real plans yet to create the BRICS single currency, says Evgeny Goryunov, Head of the Monetary Policy Department at the Gaidar Institute.

«In political terms, it is difficult to imagine that China, India, Russia, Brazil and other BRICS countries would agree to delegate the right to issue currency to a supranational central bank, the more so that the BRICS does not even have a governing body. A much more likely scenario is the gradual replacement of the US dollar with the yuan in the BRICS mutual settlements," Evgeny Goryunov notes.

Abandoning the US dollar has become part of the BRICS agenda. The BRICS countries are seeking to reduce dependence on the US currency by switching over to settlements in national currencies and developing alternative payment systems, Kirill Chernovol, Researcher at the Gaidar Institute notes. According to the data of the RF Ministry of Foreign Affairs, national currencies accounted already for 65% of mutual settlements between the BRICS countries by November 2024. As alternatives to SWIFT, the BRICS countries are developing their own financial messaging systems: SPFS in Russia and CIPS in China.

«The establishment of the BRICS Bridge system is currently discussed at the BRICS level. It will facilitate settlements in national currencies, including central banks’ digital currencies. We are talking about settlements growth in national currencies only in terms of trade between the BRICS countries, not with other countries," Kirill Chernovol points out.

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