Masterstroke of the BRICS: The alliance is on the verge of overthrowing the dollar monopoly!

In line with their ambition to move away from the dollar, the BRICS are multiplying initiatives deemed useful to achieve these objectives. Essentially, this involves questioning the institutions that favor American hegemony. Following this logic, Russia, an influential member of the BRICS, plans to introduce a new payment system that aims to undermine the SWIFT network.

The BRICS want to move away from the current payment system

The BRICS, the alliance of emerging economies formed by Brazil, Russia, India, China, and South Africa, are set to shake up the global financial landscape. Russia announced that the organization is going to establish its own new payment system, at least confirming reports that had been leaking for several months.

Unlike the existing SWIFT mechanism, this BRICS alternative will bypass the US dollar and settle transactions in local currencies. The initiative, which Russia intends to advocate and propose to several countries, promises to reshape the dynamics of international trade.

The BRICS’ decision to develop a payment system independent of the US-dominated SWIFT network is, in any case, a sign of a significant shift in global economic alliances.

By facilitating cross-border transactions in local currencies, the initiative aims to reduce dependence on the US dollar. This will allow the BRICS and other developing countries to better control their financial and economic destiny.

BRICS: 159 Countries Eyeing Russia's New Payment Systemhttps://t.co/1Qex2X2itB

— Thomas Shum (@thomaskkshum) February 11, 2024

A project that already has numerous interested parties?

As of the latest updates, the BRICS initiative has garnered the support of 20 countries. These nations have reportedly committed to conducting transactions in local currencies once the system is launched. While Russia presents the concept to 159 countries in the South, Asia, Africa, and Latin America, the potential impact on the global financial order cannot be underestimated.

By proposing an alternative to SWIFT, the BRICS aim to give countries the choice between using local currencies or the US dollar for international trade. This approach is part of the broader agenda of the group, which seeks to promote multipolarity in global financial governance.

But we are still far from the adoption of the BRICS initiative. The choice to participate in this project for a new payment system based on the Russian System for Transfer of Financial Messages (SPFS) is up to the approached countries.

Therefore, by weighing the pros and cons of such a system, the BRICS initiative could either strengthen or challenge the domination of the US dollar in international trade. An uncertainty highlights the possibility of a radical change in the global economic and monetary landscape.