Brazilian President Advocates the Creation of BRICS Currency

Brazilian President Luiz Inacio Lula da Silva on Wednesday expressed his support for the creation of a currency for trade between the BRICS countries, including Brazil, Russia, India, China and South Africa.

He said, "I am in favor of creating, within the BRICS, a trading currency between our countries, just like the Europeans created the euro."

Earlier, the Brazilian president said the global dominance of the dollar should end. He has raised his question in a public speech, "Who decided that our currencies were weak or valueless in other countries? Why can’t a bank like that of the BRICS have a currency to finance trade relations between Brazil and China or Brazil and other countries?"

"Everyone depends on just one currency," he added.

The BRICS are working on de-dollarization and are gradually replacing the U.S. dollar with their own currencies for settlement in international trade.

Last month, Brazil reached an agreement with China to settle trades between the two countries in yuan or reals.

Russia is also looking for ways to move away from the dollar. Russian Finance Minister Anton Siluanov revealed that the Russian ruble and the Chinese yuan have replaced the U.S. dollar in settlements between the two countries. "If we look at the structure of trade between Russia and China, now more than 70% — it is already in our national currencies."

In February this year, Iraq planned to accept the yuan settlement for the first time.

Other countries are following the BRICS by moving away from using the U.S. dollar for international settlements and instead using local currencies.

Felipe Medalla, the Philippines' central bank governor, has mentioned in interviews the waning status of the dollar. "We want a multi-currency world, but so far, other currencies do not have the necessary international markets to support [it]," he said. "I think over time, the dollar will be less and less dominant, but it's happening very slowly"