The days of the US dollar’s domination of trade among BRICS countries are numbered, Russian President Vladimir Putin said on Tuesday.
Putin told the bloc’s summit that members would discuss switching trade away from the dollar and into national currencies, and the BRICS New Development Bank would play a key role.
“The objective, irreversible process of de-dollarization of our economic ties is gaining momentum,” he said. Security has been boosted across Johannesburg, where South African President Cyril Ramaphosa is hosting China’s President Xi Jinping, Indian Prime Minister Narendra Modi, Brazil’s President Luiz Inacio Lula da Silva and about 50 other leaders.
Saudi Foreign Minister Prince Farhan bin Faisal is leading the Kingdom’s delegation at the summit, where the bloc of large emerging economies seeks to assert its voice as a counterweight to the Western-led international order. The BRICS members — Brazil, Russia, India, China and South Africa — represent more than 40percent of the world’s population.
Putin, unable to attend in person because of an International Criminal Court arrest warrant, addressed the summit by video. He said the bloc was on course to meet the aspirations of most of the world’s population.
“We cooperate on the principles of equality, partnership support, respect for each other’s interests, and this is the essence of the future-oriented strategic course of our association, a course that meets the aspirations of the main part of the world community, the so-called global majority,” he said.
Despite Putin’s rejection of the dollar, Brazilian President Lula da Silva said a common BRICS trading currency would be aimed solely at easing trade between emerging nations. “We do not want to be a counterpoint to the G7, G20 or the US,” Lula said. “We just want to organize ourselves.”
Lula also said he was in favor of other countries joining the alliance, mentioning Indonesia as a potential new member. The three-day summit will hear calls for more economic cooperation and collaboration in areas such as health, education and climate change — but with a growing sentiment that the developing world is not being served by Western-led institutions. South African President Cyril Ramaphosa held separate talks with Xi in Pretoria, and said he was seeking “Chinese support for South Africa and Africa’s call for the reform of global governance institutions, notably the UN Security Council.”
De-dollarization is irreversible – Putin
The US dollar is losing its global role in an “objective and irreversible” process, the Russian president told participants at the BRICS Summit in South Africa on Tuesday. Vladimir Putin spoke via videolink, after choosing not to attend the event in person.
De-dollarization is “gaining momentum” Putin declared, adding that members of the group of major emerging economies are seeking to reduce their reliance on the greenback in mutual transactions.
The Russian leader claimed the five BRICS members – Russia, China, India, Brazil and South Africa – are becoming the new world economic leaders, adding that their cumulative share of global GDP has reached 26%.
He noted that if measured by purchasing power parity, BRICS has already surpassed the Group of Seven leading industrialised nations – accounting for 31% of the global economy, compared to 30% for the G7.
Over the past 10 years, mutual investment between the BRICS member states has increased by six times. Their total investments in the world economy have doubled, while cumulative exports account for 20% of the global total, Putin said.
Moscow is focusing on re-orienting its transport and logistics routes towards “reliable foreign partners,” including BRICS members, to ensure an uninterrupted supply of energy and food to the international market.
Russia’s primary goals include developing the Northern Sea Route and the ‘North-South’ transport corridor, Putin stated. The first, passing through the Arctic Ocean, along Russia’s northern coastline, will ensure faster goods deliveries between Europe and the Far East. The second will connect Russia’s northern and Baltic ports to the Persian Gulf and the Indian Ocean, facilitating cargo movement between Eurasian and African nations.
“We are consistently increasing fuel, food and fertilizer supplies to the states of the Global South,” and actively contributing to global food and energy security, the Russian leader said. He blamed the current international food crisis on the West’s unilateral sanctions, describing them as “unlawful.”
“Illegitimate sanctions… seriously weigh on the international economic situation,” and the “unlawful freezing of sovereign states’ assets” constitutes a violation of free trade and economic cooperation rules.
The resource deficit and growing inequality worldwide are a “direct result” of such policies, the Russian president argued. He highlighted skyrocketing grain and food prices as the latest manifestation of this process, primarily affecting the most vulnerable nations.
Moscow is represented at the Johannesburg summit, which runs from August 22 to 24, by Russian Foreign Minister Sergey Lavrov. Putin opted not to attend the event after a decision by the International Criminal Court (ICC) to issue a warrant for his arrest in March. The court based the order on Ukraine’s allegation that the Russian evacuation of children from the conflict zone amid hostilities between the two nations amounted to “unlawful population transfers.”
South Africa is a signatory of the Rome Statute of the ICC, and the US and its allies had pressured it to detain Putin should he travel to the country. Moscow has repeatedly denied the ICC’s allegations and stressed that it does not recognize the court’s authority, declaring the warrant legally null and void.
Although South African President Cyril Ramaphosa repeatedly stated that he would not carry out the order, claiming it would amount to a “declaration of war,” Moscow ultimately decided to send Foreign Minister Sergey Lavrov to the BRICS summit to represent Russia.
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