BRICS working on alternatives to USD and SWIFT

Moscow: Russian President Vladimir Putin announced that BRICS member countries are working on an international reserve currency and an alternative payment system. The failure of the United States to stop the Russian transactions with other countries despite the sanctions imposed is drawing the world’s attention. Therefore, the United States demands India stop fuel purchases from Russia. In this scenario, the announcement of the Russian President that the BRICS member countries are working on an alternative for the USD as the international currency may cause significant upheavals.

Moreover, the meeting of the BRICS members India, Russia, Brazil, China and South Africa is starting. The Russian President has already announced that BRICS will be working on an alternative for the global reserve currency and the payment system. This reserve currency could be used as an alternative to the USD. Russia and China have been consistently working on this for the last few years. But the Russian President has increased the seriousness by claiming that the efforts are being made on the organisational level through BRICS.

The United States is using the USD as a weapon against its adversaries. The United States imposed harsh sanctions against the Russian dollar transactions. But Russia countered the US sanctions by transacting in roubles and other local currencies with other countries. At the same time, Russia has created ‘System for Transfer of Financial Messages’ (SPFS) as an alternative to SWIFT, the payment system dominated by the United States and western countries. The Russian President has proposed that the banks in the BRICS countries can easily connect with SPFS.

The United States is using the USD to torment other countries. But the International Monetary Fund (IMF) warned that this is weakening the USD. The warning seems to be becoming a reality and the importance of the USD on the global level is declining. Countries like Russia and Iran, facing sanctions from the United States, are using alternative methods to transact with other countries. Even China is taking steps to challenge the USD domination. The IMF and economists are warning that in this scenario if the United States intends to maintain the position of the USD, it will have to stop using the USD as an economic and diplomatic weapon. But the United States does not seem to be in any mood to do so.