Breaking News: The economic alliance BRICS (Brazil, Russia, India, China and South Africa) has come out strong in its de-dollarization mission for 2024. Gold and oil production have become key strategies to dethrone the US Dollar.
Led by the five founding nations and more recent joiners, the bloc is keen to abandon the US dollar as the main global reserve currency.
The Alliance is leveraging multiple sectors and resources to achieve this goal, and these sectors have worked well so far.
Latest BRICS News: Gold and Oil-Based Strategies of Countries
Gold has always been considered a safe store of value, especially during times of economic uncertainty, and the BRICS countries, especially China and Russia, have significantly increased their gold reserves in recent years.
China, which is also the world's largest gold producer, is accelerating efforts to increase its gold reserves as it aims to establish the yuan as an international reserve currency.
Meanwhile, Russia has used gold as a way to protect itself from Western sanctions and diversify its reserves outside the US dollar.
The two countries are now considering creating a gold-backed currency for international transactions within the BRICS bloc, an approach aimed at building trust between trading partners and reducing reliance on the dollar.
Oil is another strategic resource in the BRICS plan to dethrone the dollar. Russia, one of the world's largest oil producers, has already started selling its oil for currencies other than the dollar, such as the ruble and yuan.
This marks an important step towards de-dollarization, as oil is traditionally traded in US dollars around the world.
Additionally, Middle Eastern countries such as Saudi Arabia, historical allies of the United States, are increasingly interested in diversifying their economic alliances and exploring the possibility of accepting other currencies for oil trade.
If this trend continues, it could mark a major turning point for the global financial system.
Cooperation and infrastructure for de-dollarization
BRICS countries are also investing in financial infrastructure to support dedollarization.
The New Development Bank (NDB), established by the BRICS countries, was set up to fund development projects in the region and reduce dependency on Western financial institutions such as the International Monetary Fund (IMF) and the World Bank.
The NDB has begun lending in member countries' local currencies, further encouraging the use of national currencies in trade and investment.
Additionally, the creation of alternative payment systems such as the China Cross-border Interbank Payment System (CIPS) provides an alternative to the US-led SWIFT system.
This will allow BRICS countries to conduct international transactions without using the dollar, reducing the impact of US financial sanctions.
Despite this progress, the path to dedollarization is not without challenges. The US dollar remains deeply ingrained in the global financial system, and most international trade is still denominated in dollars. Moreover, the dollar's liquidity and stability make it an attractive option for investors and governments around the world.
But efforts by BRICS nations to diversify their reserves and promote the use of their own currencies could chip away at the dollar's dominance, making the search for alternatives to the dollar all the more important amid rising geopolitical tensions and economic uncertainty.
Conclusion
2024 has become a crucial year for the BRICS economic alliance in its de-dollarization mission, with the goal of reducing dependency on the US dollar and promoting a more multipolar monetary system, with gold and oil being fundamental pillars of this strategy.
The BRICS countries are seeking to displace the dollar and reshape the global economic landscape by increasing their gold reserves, selling oil in alternative currencies, and developing an independent financial infrastructure.
The future of dedollarization depends on the ability of the BRICS nations to remain united and continue to expand their economic influence. If they succeed, the world may witness a major transformation of the international financial system in the coming decades.
