BRICS to completely ditch US dollar in three years
The BRICS bank, commonly called the New Development Bank (NDB), officially announced a three-year plan to completely end reliance on the US dollar for the whole world.
The three-year de-dollarization initiative will lead to BRICS members settling trade in their local currencies and not the US dollar, according to a report by watcher.guru.
The NDB is seeking alternative ways to dethrone the US dollar from dominating the global financial sector. NDB will later provide details of BRICS leaders’ promise of diminishing transactions made in the US dollar.
The NDB has already outlined its first plan where it lends loans to other developing countries in local currencies. The bank suggested to stop lending loans in the US dollar and limit the number of settlements in the USD. The move adds pressure on the dollar, reducing the demands for it by a small margin.
However, the initiative could land further blows on the prospects of the US dollar. The NDB will later provide guidelines for its plans for boosting the usage of local currencies and strengthening the national economy of BRICS members. Businesses in developing countries could thrive if local currencies are given more prominence as they would no longer lose out on forex charges.
Therefore, the global financial sector could change rapidly by 2026, leading the way to a new world order. The financial power could tilt from the West to the East, and developing countries could take the driver’s seat.
BRICS already controls 30% of the global economy, and the numbers could shoot up if they completely end reliance on the US dollar.
The report added that if BRICS play their cards well, the US dollar will lose its power in the international markets by 2026. Local currencies will dominate the financial sector, and one among them could potentially become the next global reserve currency.