The economic coalition of nations known as BRICS has “medium to long-term” ambitions to create a new global currency and challenge the US dollar, according to the chief financial officer of the BRICS New Development Bank.
BRICS nations, which consists of Brazil, Russia, India, China and South Africa, are currently pushing to boost direct trade in their own national currencies, Leslie Maasdorp tells Bloomberg TV.
At the moment, BRICS is not ready to create a new form of fiat that rivals the world’s reserve currency, says Maasdorp.
But he thinks that will change.
“The development of anything alternative [to the US dollar] is more a medium to long term ambition.”
Maasdorp says the Chinese Renminbi is also a “very long way” from challenging the dollar’s dominance.
In addition, he says the New Development Bank, which is designed to support infrastructure and sustainable development projects in emerging markets, is currently entirely dependent on USD.
“The New Development Bank has the US dollar as its anchor currency. Our balance sheet is in US dollars. We are firmly embedded in the US dollar hemisphere.”
BRICS representatives from various nations have spread mixed messages about if and when BRICS will create a core common currency in the future.
Brazilian President Luiz Inácio Lula da Silva and representatives from Russia have led the chorus of leaders pushing to launch a new currency.
But South African leaders appear to be more cautious, with its Foreign Minister Naledi Pandor saying a global BRICS currency is “a matter we must discuss and discuss properly”.
BRICS has received a lot of interest this year from countries who would like to join the group.
African Ambassador Anil Sooklal says 13 nations from Africa, Latin America and Asia have either applied or formally approached the BRICS leaders to become members of the association.Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
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