South Africa, Brazil, other BRICS nations adopt new currencies to reduce dollar influence

The BRICS nations; Brazil, Russia, India, China and South Africa, have agreed to reduce their reliance on the dollar in loan advances to their members.

This was disclosed by the President of the New Development Bank (NDB), better known as the BRICS Development Bank, Dilma Rousseff, on Tuesday.

Rousseff said the 30 per cent of loan disbursed by the bank will now be in South African rands, Brazilian real and Indian rupee going forward.

This will reduce the exchange rates risks tied to their currencies’ exposure to the movement of the dollar, as the BRICS Bank aims to disburse between $8 billion to $10 billion in 2023.

“We expect to lend between $8bn-$10bn this year,” Rousseff told the Financial Times, adding, “Our aim is to reach about 30 per cent of everything we lend . . . in local currency.”

She said: “We’re going to try to either do a currency swap or issue debt. And also in rupees,” after revealing BRICS Bank’s loan will come in rand for lending in South Africa and real for debt obtained by Brazil.

Rousseff noted that their members’ local currencies are not alternatives to the dollar, but also stated that “They’re alternatives to a system.

“So far the system has been unipolar … it’s going to be substituted by a more multipolar system,” the banker explained.

She further disclosed that the BRICS Bank doesn’t have similar operational policies to the World Bank and the International Monetary Fund (IMF).

Rousseff said unlike the World Bank and the IMF, BRICS Bank doesn’t dictate the policies of nations or political conditions before offering loans.

“We repudiate any kind of conditionality,” Rousseff continued, adding, “Often a loan is given upon the condition that certain policies are carried out. We don’t do that. We respect the policies of each country.”

Meanwhile, Ripples Nigeria previously reported that President Bola Tinubu is being represented by Vice President Kashim Shettima at the 15th BRICS summit in South Africa.

Some of the agenda at the event is the confirmation of four or five new members, out of the 15 countries that applied for membership.

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