Brazilian President Luiz Inácio Lula da Silva has expressed his determination to address the de-dollarisation issue during the upcoming BRICS meeting. With a focus on promoting trade in national currencies, President Lula da Silva questions the necessity of trading between Brazil, Argentina, and China in U.S. dollars. This article explores his stance and highlights the significance of his proposal.
President Lula da Silva Takes a Stand:
During the Paris summit on a new global financial pact, President Lula da Silva announced his intention to raise the matter of de-dollarization at the forthcoming BRICS meeting in Johannesburg. The BRICS alliance comprises Brazil, Russia, India, China, and South Africa, and their leaders will convene from August 22nd to 24th.
Questioning the Use of Dollars:
Lula da Silva raised a thought-provoking question, asking why Brazil and Argentina traded in U.S. dollars instead of utilizing their currencies. He further questioned the barriers preventing Brazil and China from trading in their respective currencies. The president emphasizes that the necessity of purchasing dollars is a significant concern that needs to be addressed.
The Paris Summit’s Objective:
The Paris Summit, hosted by French President Emmanuel Macron, brings together leaders from 50 nations for a two-day gathering to formulate a new global financial pact. The summit seeks to achieve a consensus on reforming the international financial system and develop proposals for further discussion in various forums.
Russian Opposition to French President’s Participation:
While President Macron expressed interest in attending the upcoming BRICS summit, Russia objected to his participation, citing a perceived “hostile and unacceptable policy” towards Moscow. However, the agenda of the BRICS meeting remains focused on crucial economic discussions.
President Lula da Silva’s Vision:
President Lula da Silva has ardently advocated reducing reliance on the U.S. dollar in global trade. He supports the establishment of a common currency among BRICS countries, drawing parallels to the European Union’s creation of the euro. This proposition will be discussed during the upcoming BRICS leaders’ summit.
BRICS Bank as an Alternative Institution:
President Lula da Silva views the BRICS bank as a viable alternative financial institution. He seeks to enhance its role as an instrument for financing and strengthen cooperation with the African Development Bank. This approach aligns with the bloc’s objective of fostering economic cooperation and reducing dependence on traditional financial systems.
President Lula da Silva’s push for de-dollarization within the BRICS alliance signifies a shift towards utilizing national currencies for trade and exploring the potential for a common currency. With the upcoming BRICS meeting serving as a platform for these discussions, the world eagerly awaits the outcomes and implications of these economic deliberations.