A senior Russian official has stated that the plan to build the BRICS payment system 'is not a hypothesis', signaling a shift towards reducing dependence on the dollar through alternative financial mechanisms.
A new era? Russia claims the feasibility of the BRICS payment network.
Russian Deputy Foreign Minister Sergey Ryabkov affirmed that plans to establish the BRICS payment system are tangible and progressing, describing them as 'not a hypothesis'. In an interview with the Tass Analytical Center on Tuesday, Ryabkov reflected on Russia's role during its presidency of BRICS, emphasizing that this initiative is both real and actionable. When asked about the feasibility of such a payment system among BRICS countries, he stated:
Not just existing. It is not a hypothesis.
Discussing the possibility of Russia's cooperation with countries like Brazil and Iran, Ryabkov asserted that Russia is ready to move forward and indicated that other BRICS countries are likely to follow suit. 'Of course. Moreover, other countries will also join in. This plan is currently under discussion, and its implementation is not a dollar replacement model in every solution.'
It is a model creating an additional circuit to operate in conditions when the main and well-known dollar channel is experiencing issues due to reasons beyond BRICS' control,” he explained. He further clarified that this plan aims to create a parallel mechanism rather than completely replace the dollar.
The expanded BRICS group, now including Brazil, Russia, India, China, South Africa, and six new members—Saudi Arabia, Iran, UAE, Egypt, Ethiopia, and Argentina—has intensified efforts to reduce dependence on the US dollar for international trade and investment. This move aligns with the broader trend of 'de-dollarization', driven by geopolitical tensions and the desire to shield the economy from dollar volatility.
Recent developments include trade agreements in local currencies, the establishment of alternative payment systems, and discussions about creating a BRICS currency to facilitate intra-bloc transactions. However, these efforts face barriers such as differing economic structures, varying policy priorities, and the need for a robust mechanism to ensure currency stability and liquidity across the bloc.
Ryabkov also highlighted the additional components necessary to support the system, including clearing payment mechanisms, transaction insurance systems, and ensuring the transportation of goods. 'We are also studying them - transaction insurance systems, including insurance for the transportation of goods and commodities, which will also not depend on harmful external influences,' he noted.
The Deputy Minister concluded that these measures together signal meaningful progress toward establishing a viable alternative to existing financial structures. He commented:
Overall, this is the minimum level for 'BRICS' to say that things have progressed and a real alternative has emerged.
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