BRICS and the dollar

Image: Feson Xie


The BRICS want to “play it safe” because all its members, with the exception of Russia, have complex economic and financial interdependence relations with the West

Last month, “the alternative media community was in shock after the Bank of the BRICS confirmed that it complies with Western sanctions”, and now that same alternative media community has just been hit with two more truth bombs after other top officials confirmed they don't want to de-dollarize and are not anti-Western. The South African finance minister, Enoch Godongwana, I told Reuters earlier this month, in an interview, that the focus of the group is expanding the use of national currencies and not de-dollarization.

The communication vehicle also quoted the financial director of the New Development Bank (NDB, popularly called the BRICS Bank), Leslie Maasdorp, in the same article, which told them that “the bank's operating currency is the dollar for a very specific reason, American dollars are where the greatest liquidity wells are found… You cannot leave the dollar universe and operate in a parallel universe ”. The official confirmation that the BRICS do not want to de-dollarize led directly to the following clarification about the fact that they are not anti-Western.

The South African ambassador to the BRICS, Anil Sooklal, corrected misperceptions about the organization's global role in an interview with Bloomberg, a few days ago, in which he stated that “there is an unfortunate narrative being developed, according to which the BRICS is anti-Western, that the BRICS were created to compete with the G7 or the Global North, and that is incorrect. What we seek is to advance the Global South agenda and build a more inclusive, representative, fair and equitable global architecture.”

In connection with this purpose, he also confirmed what Godongwana and Maasdorp said at the beginning of the month about how the BRICS do not wish to de-dollarize. In Sooklal's words, “Trade in local currencies is firmly on the agenda (but) there is no de-dollarization item on the BRICS agenda. The BRICS are not calling for de-dollarization. The dollar will remain the main global currency – This is a reality”. These revelations about the BRICS can understandably confuse the average member of the alternative media community.

After all, many of them have been misled by top influencers into imagining that this group is conspiring to deal a deathblow to the dollar out of hatred of the West, but nothing could be further from the truth after what top officials have revealed over the last three years. weeks. The president of the BRICS Bank, Dilma Rousseff, confirmed that the bank complies with Western anti-Russian sanctions; Godongwana, Maasdorp and Sooklal confirmed that the bank does not want to de-dollarize; and the latter also confirmed that it is not anti-western.

The BRICS can still “advance the agenda of the Global South and build a more inclusive, representative, fair and equitable global architecture”, exactly as Sooklal clarified his intention despite the “politically inconvenient” facts that were just shared, but that will take place at a gradual and not accelerated pace. Therein lies the core of misperceptions on the subject, that Russia sought to correct at the beginning of the month, after you finally realized that your business interests soft power they are threatened by the unrealistic expectations of their supporters.

A critical mass of the alternative media community became convinced that the BRICS was something it is not, through a combination of well-meaning but naive influencers who forced their wishes on it, and others who maliciously did the same. to generate influence, promote their ideology and/or cheat. At the same time, some of this camp's rivals in the mainstream media have alarmed the BRICS with the hidden aim of galvanizing Westerners against it, but which have also given false credence to the populist claims of the alternative media community.

Taken together, it is easy, in hindsight, to understand why so many people have fallen for the false narrative that the BRICS are conspiring to deal a death blow to the dollar out of hatred of the West, which is why those in charge of the organization have decided to set the record straight in recent weeks. before your next summit. They did not want their supporters' unrealistic expectations to lead to deep disillusionment which in turn made them susceptible to hostile suggestions, nor did they want to frighten the West into overreacting.

The first potential result that could have happened if the aforementioned clarifications had not been made was the risk of filling its supporters with such despair that they could become apathetic towards the BRICS or even turn against it after feeling deceived. As for the second, some in the West could have intensified their pressure campaigns against the BRICS and its partners, including blackmail, political interference and threats of sanctions, all to stop the bloc in its tracks.

After debunking the misinformation that has been spewed about their organization by both the alternative and mainstream media community, each with opposing polar agendas but still suspiciously relying on virtually identical narratives, BRICS officials are now more confident that these worst case scenarios can be avoided. This reality check calms his supporters and prepares them to expect a prolonged transition to multipolarity, while at the same time reducing the chances that the West will overreact to their group's goals.

To develop the last observation, the events of the last eighteen months, since the start of Russia's "special operation", have convinced the West that the global systemic transition to multipolarity is irreversible, which is why they are now willing to consider reforms in their countries. hegemonic models. the german chancellor Olaf Scholz, the former director for Europe and Russia at the US National Security Council, Fiona Hill, and Goldman Sachs President, Global Affairs, Jared Cohen suggested this on the same day in mid-May.

They believe that the West has to engage with the Global South on a more equal level, which requires curbing some of its most flagrant exploitative practices so as not to lose more hearts and minds to the Sino-Russian Entente. To that end, they are positively inclined to accept gradual changes in the global financial system, such as those in charge of the BRICS confirmed to have in mind, but will resolutely respond to any revolutionary developments that risk drastically accelerating this transition.

In simple terms, the BRICS want to “play it safe” because all their members, with the exception of Russia, have complex economic-financial interdependence relationships with the West, which should not overreact to their piecemeal reforms, since their Policymakers themselves now believe they are inevitable. Among these four members, two schools of thought predominate, represented by China and India, whose respective differences in views have been explained in detail. here.

In short, China wants to accelerate the internationalization of the yuan and integrate the BRICS into the Belt and Road Initiative, while India wants to prioritize national currencies and keep the BRICS officially separate from the Belt and Road Initiative. However, both agree that changes in the global financial system must be gradual, in order to avoid provoking a mutually harmful overreaction on the part of the West, with whom all of them, with the exception of Russia, maintain relations of complex interdependence.

Everyone is entitled to their own opinion about this reality that has just been described, but the facts that have been shared throughout this analysis in support of the associated observations cannot be denied. Any major influencer in the alternative media community who still insists on the debunked narrative about the BRICS conspiracy to deal a deathblow to the dollar out of hatred of the West is dishonest. Those of your audience who now know more should politely fact-check their posts to prevent others from being deceived.

*Andrew Korybko holds a master's degree in International Relations from the Moscow State Institute of International Relations. Book author Hybrid Wars: From Color Revolutions to Coups (popular expression).

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