The BRICS group of emerging-market nations will discuss deepening the use of local currencies in trade between member states at a summit in South Africa next week, the nation’s ambassador to the bloc said.
(Bloomberg) — The BRICS group of emerging-market nations will discuss deepening the use of local currencies in trade between member states at a summit in South Africa next week, the nation’s ambassador to the bloc said.
The talks will focus on issues including the establishment of a common payments system, while a technical committee is likely to be formed to start considering a potential joint currency, Anil Sooklal said in an interview at Bloomberg’s Johannesburg office on Monday. There are no plans to discuss replacing the US dollar as the world’s de facto global currency, he said at a conference at the same venue.
“Trading in local currencies is firmly on the agenda,” Sooklal said. “There is no agenda item of de-dollarization on the BRICS agenda. BRICS is not calling for de-dollarization. The dollar will continue to be a major global currency — that’s a reality.”
The BRICS members — Brazil, Russia, India, China and South Africa — are striving to conduct more trade between themselves in their own currencies as part of an effort to gain more global influence and counterbalance the dominance of the US. The New Development Bank, a lender created by BRICS, has targeted a third of its lending being in domestic currencies by 2026.
The bank’s chief financial officer, Leslie Maasdorp, said last month that BRICS developing a common currency to challenge the dollar is a medium- to long-term ambition.
Read More: BRICS Bank CFO Sees No Move Any Time Soon Toward Common Currency
The summit of BRICS leaders is scheduled to take place from Aug. 22-24 in Johannesburg, where they’ll discuss whether to admit more nations to its ranks. Forty heads of state and government have confirmed their attendance, and that number could rise to about 50, according to Sooklal.
“I think there is a general consensus that BRICS has to expand,” he said. “We have worked out some rules of procedure and criteria.”
Formed officially in 2009-10, BRICS has struggled to have the kind of geopolitical influence that matches its collective economic reach. The bloc’s members represent more than 42% of the world’s population and account for 23% of global gross domestic product and 18% of trade.
The BRICS group aims to promote the interests of the developing world and isn’t in competition with any other bloc, he said.
“There’s an unfortunate narrative being developed that BRICS is anti-West, that BRICS was created as competition to the G7 or the Global North” and that is incorrect, Sooklal said. “What we do seek is to advance the agenda of the Global South and to build a more inclusive, representative, just, fair global architecture.”
–With assistance from Alister Bull.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.