BRICS nations announced a new currency designed to replace the dollar.The creation of this new gold and commodity backed currency will be discussed at the BRICS summit this August.
BT’s Kei Pritsker explains how this new currency could overturn the hegemony of the US dollar.
Why not just use national currencies?
My understanding of the proposed “BRICS currency” is that it would be more of a Keynes-inspired bancor currency setup used in some kind of international bank (alternative to IMF, ect) to facilitate easier balance of payments settlement. As opposed to being a physical currency used in day to day life.
I could also be way off the mark here, don’t think there is a lot of concrete info on this yet. Ideally we hear more at the upcoming summit.
Which national currency exactly, I don’t think BRICS like the idea of using RMB too much, it’s just weaponizing another currency to replace the current one.
Currencies, plural. National currencies of BRICS members
Going to bet it’s to simplify things.
Using national currencies would complicate matters a bit. Exchange Rates, and all that.
So now they have to invent a whole new currency, with exchange rate between it and every other currency?
…yes? BRICSbucks could be an united currency used in BRICS states like the EU.
That seems to be the intention, and that’s one of the reasons I’m worried. Switching to euro had benefited the EU core (Germany, France) quite well, while the newly joined others (Czech Republic, Greece) saw an increase in prices and overall economic issues. Now it is arguable that it was the intention back then with EU, and is not the intention here. However, I must remind you, that of the core BRICS members, only PRC is truly socialist, and it also has waaay more developed and advanced industry than the rest. Thus it will be profitable for the local bourgeoisie of other members to emphasize feeding said industry with natural resources and buying everything else. Single currency will help with this.
Just a correction, Czech Republic doesn’t use Euro. Although it promised to do so many times, it uses its own currency Czech Crown.
Are you sure? I only been there in 2005 and I’m pretty sure we used euros already
Pretty sure, I live here :). You can pay in most bigger shops and tourist spots in euros, but the main currency is Czech Crown.
Guess my memory is worse than I thought. Thank you for the correction