No consensus on de-dollarisation during Brics talks but Putin says process is ‘irreversible and gaining pace’

The discussions around de-dollarisation of Brics economies is up to the leaders after the Business Forum could not reach consensus on Tuesday.

The forum marked the start of the 15th Brics Summit being held in Sandton this week and was attended by entrepreneurs, policymakers, businesspeople and academics.

De-dollarisation and expansion of Brics are expected to form a large chunk of discussions during the summit.

A move from the dollar as the main trade currency and the introduction of their own currencies has received support from some Brics countries including China, Russia and Brazil.

In his report to leaders of the Brics nations, Standard Bank CEO Sim Tshabalala said the business forum debated the issue of moving away from the dollar but could not agree.

“Participants also debated the question of whether a Brics currency is possible or even desirable, with strong views expressed both for and against and little consensus reached,” said Tshabalala.

The discussions were expected to be taken up by leaders of the Brics countries at their private leaders retreat on Tuesday evening.

Russia’s President Vladimir Putin told the Brics Summit, through a pre-recorded message since he cannot participate in person due to his international warrant of arrest, that the process towards de-dollarisation was irreversible.

He said Brics countries account for nearly 26% of global GDP. The five countries combined, he said, were also ahead of the G7 countries in terms of purchasing power parity with 35.1% against 30% for G7 forecast for 2023.

“The objectives and irreversible process of de-dollarisation of our economic ties is gaining pace. We are working to fine tune effective mechanism, mutual settlements and monitoring financial control,” said Putin.

“As a result, the share of the US dollar export and import operations within Brics is declining. Last year it was only 28.7%. In fact, this summit is to discuss the detail, the entire range of issues related to the transition to national currencies in all areas of economic co-operation between our five nations.”

Tshabalala had earlier said there were several issues that had to be clarified that would assist the discussions on de-dollarisation to “progress more fruitfully”.

He said there was a need for a clearer distinction between international payments and reserve currencies. 

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