Prof. Laura-Anca PAREPA
Executive summary: This paper examines the role of BRICS in promoting de-collarisation and the development of multipolar finance in the global economy. For decades, the international economic order has been based on the US dollar and Western financial institutions. However, the 2007-2008 financial crisis highlighted the vulnerabilities of the existing system. BRICS member States are increasingly questioning the viability of the current model and are seeking to create mechanisms to reduce their dependence on the US dollar and Western institutions. Some initiatives of the BRICS, such as the Quota Reserve Arrangement, the increasing use of national currencies in intra-BRICS trade settlements and the granting of loans in local currencies by the New Development Bank, are concrete efforts to build parallel mechanisms that diversify global finance and strengthen the strategic autonomy of participants. In addition, the proposal for a BRICS reserve currency, indexed to a basket of member countries’ currencies, reflects the group’s desire to institutionalize alternatives to US dollar domination. In this context, the efforts of BRICS to de-dollarize undermine the centrality of the US dollar and seek to reshape existing norms and institutions. In conclusion, while de-dollarization is a complex and long-term process, BRICS play an important role in the pluralization and rebalancing of global finance, leading to a slow but constant transformation of the international monetary system.
KeywordsDe-dollarization, financial multipolarity, local currency, digital experimentation.
Abstract: This paper explores the role of BRICS in promoting de-dollarization and advancing financial multipolarity in the global economy. For decades, the international economic order has relied on the U.S. dollar and Western-controlled financial institutions. However, the 2007–2008 financial crisis exposed vulnerabilities in the existing framework. BRICS states have increasingly questioned the sustainability of the current model and have sought to create mechanisms that reduce reliance on the U.S. dollar and Western-controlled institutions. Some BRICS initiatives, such as the Contingent Reserve Arrangement, the increasing use of national currencies in intra-BRICS trade settlements, and the issuance of loans in local currencies by the New Development Bank, represent concrete efforts to build parallel mechanisms that diversify global finance and enhance the strategic autonomy of participating states. Moreover, the proposal for a BRICS reserve currency, anchored in a basket of member currencies, reflects the group’s desire to institutionalize alternatives to U.S. dollar dominance. In this context, BRICS efforts to de-dollarize challenge the centrality of the U.S. dollar and seek to reshape existing norms and institutions. The paper concludes that while de-dollarization is a long-term and complex process, the BRICS play a significant role in pluralizing and rebalancing global finance, leading to a slow but steady transformation of the international monetary system.
Key-words: De-dollarization, financial multipolarity, local currency, digital experimentation.
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