BRICS Back Down From Challenging The Dollar : What Went Wrong ?

At a time when the dollar reigns supreme in global trade, the BRICS alliance seemed determined to shake up this established order. For several months, this economic bloc has been exploring the possibility of freeing itself from the dollar and even creating a common currency to facilitate their exchanges. However, the project for a single currency is now abandoned, a decision that represents a notable setback for the BRICS in their quest for monetary sovereignty and in their desire to challenge American dominance.

The Aborted Single Currency Proposal of the BRICS

In a recent statement, the Kremlin’s spokesperson, Dmitry Peskov, officially announced the abandonment of the idea of a single currency for the BRICS bloc. He believes that it is “not possible” at this stage to realize such an ambition. This declaration is all the more surprising given that the idea of a common currency has been at the heart of the bloc’s strategic discussions for months, driven by an obvious desire to reduce their dependence on the US dollar. Such dependence has been exacerbated by the sanctions imposed on Russia by western countries, which pushed Moscow to consider economic alternatives. But today, the hopes for a common currency are collapsing, as the BRICS are no longer in a position to challenge the dollar’s hegemony in a unified manner.

The abandonment of the single currency project is thus seen as a strategic retreat for the BRICS. Through this initiative, the bloc intended to assert its collective power in the face of American influence, with the goal of strengthening their economic and geopolitical weight. However, economic realities and internal divergences seem to have taken precedence over this unified ambition. Moreover, Donald Trump’s return to the White House may also have influenced this decision, as the BRICS now seek to avoid any open confrontation with the United States in the monetary realm.

A Refocusing on the Dollar and Implications for the Future

Amidst this abandonment, another significant announcement has caught attention. The BRICS bloc no longer aims to actively turn away from the dollar in its trade exchanges. According to Vladimir Putin, the group no longer plans to “do without the greenback” in international transactions. This turnaround, once again, seems intimately linked to political changes in the United States and could reflect a strategy of appeasement toward the Trump administration. Dollarization is a long-term process, as the dominance of the dollar remains a major obstacle to short-term initiatives.

This decision could, however, divide the members of the BRICS. Brazil, for instance, has already hinted that it may independently pursue certain monetary diversification efforts, even in the absence of collective support. This refocusing around the dollar could therefore complicate the bloc’s unity, as each country seeks to defend its own interests in an unstable economic context.

With the abandonment of their single currency project and a return to the dollar in exchanges, the BRICS are engaging in a reconfiguration of their economic strategy. This turnaround could weaken their credibility regarding dollarization. However, it could also offer additional maneuvering room for each member to adjust its monetary policy to its national priorities. It remains to be seen whether the bloc will be able to reinvent itself around other common initiatives and avoid fragmentation that would weaken its voice on the international stage.