“Even in the current geopolitical turbulence, BRICS is not aimed against anyone. It even does not confront the current international economic and financial institutions, rather it is designed to supplement them,” Babuskhin said, adding, “In fact, it offers alternative instruments, which are supposed to be safe from politicized Western architecture, including in the context of the de-dollarization trend.”
In this sense, one of the most important achievements of BRICS is the New Development Bank as well as Contingent Currency Arrangement, which were launched in 2014. To date, the NDB’s loan portfolio includes 90 projects amounting to more than USD 30 bn, according to the senior Russian diplomat.
“In order to diversify and expand its potential for the benefit of member-economies, it is going to increase the share of non-sovereign projects and to promote cooperation network with other multilateral and national development and commercial banks. We also welcome the NBD’s new shareholders Bangladesh, UAE, Egypt and Uruguay and expect more countries to come in,” Babushkin noted.
Traditionally, the BRICS agenda closely corresponds to the G20 priorities, including the need to consolidate the efforts and interests of emerging economies and empower the countries of the Global South. Hence, BRICS is a natural source of support of the current Indian Presidency in the G20, the diplomat emphasised.
“The BRICS members have been taking consistent steps to switch to settlements in national currencies for quite some time now and working out new payment mechanisms. Against this backdrop, the proposal of the Brazilian President Lula de Silva to think about the creation of a single BRICS currency sounded relevant. At the last year’s summit the President of Russia Vladimir Putin spoke about an international reserve currency based on the currency basket of the BRICS countries,” the senior diplomat said, adding, “These ideas demonstrate new tendencies, however it’s clear that a lot of aspects around that require in-depth study. For instance, the creation of a single currency suggests the establishment of a single emission center and regulator as well as the synchronization of macroeconomic and monetary policy.”
On the other hand, a BRICS payment instrument based on the currency basket would help to carry out mutual settlements without any reliance on the US dollar, claimed the Russian diplomat. “In any case, the issues of building an effective independent settlement and payment infrastructure are among the priorities of BRICS in the financial track. Consultations on that are going on.”
