The Future of Global Finance: BRICS and Its New Currency Initiative

 

The Kazan venue of BRICS summit becomes a landmark in the history of the world economy in terms of the introduction of a note whose value is primarily symbolic and designed to undermine the supremacy of the US dollar. Toped by President Putin, this undertaking is in line with the group’s aspiration to inform and establish a more equitable system of international finance.

The new currency, which does not have a name but is termed “the unit” for convenience, is suggested to be a combination of gold and the currencies of the five BRICS countries. This design is aimed at enhancing the returns and minimizing the volatility associated with the currency. There are already optimistic estimates of the prospects of a common BRICS currency but special attention is paid to its practicality especially by the Central Bank of Russia.

While BRICS nations are still considering the modalities of this new initiative, the prospect of a new financial order is becoming more obvious. Should this initiative succeed, it would free the countries from using US dollar for trade amongst themselves and promote a truly multi-polar economy.