The BRICS nations are actively working on creating a new currency — possibly in digital form and backed by gold and other commodities — with a plan to unveil its progress at the upcoming leaders' summit in August, according to Alexander Babakov, Deputy Chairman of the Russian State Duma. His remarks, made at the India-Russia Business Forum in New Delhi, have drawn significant attention from global financial circles.
New Currency for BRICS: From Concept to Reality
Babakov stated: “The transition to settlements in national currencies is the first step. The next one is to provide the circulation of digital or any other form of a fundamentally new currency in the nearest future.” He added that during the BRICS summit hosted by South Africa in August, “the readiness to realize this project will be announced; such works are underway.” The BRICS bloc currently comprises Brazil, Russia, India, China, and South Africa, with several other nations — including Argentina, Iran, Indonesia, Turkey, Saudi Arabia, and Egypt — expressing interest in joining.
National Currency Settlements Gain Momentum
Prior to launching a joint currency, BRICS members have already expanded bilateral trade using their own currencies. Russian President Vladimir Putin and Chinese President Xi Jinping recently agreed to adopt the Chinese yuan for settlements with emerging economies. Furthermore, China and Brazil signed a bilateral deal to facilitate trade directly in their national currencies, bypassing the U.S. dollar. Babakov emphasized that India and Russia “should institute a new economic association with a new, shared currency,” while noting that China would play a crucial role in developing a common currency for the three nations.
Potential Backing: Gold, Rare Earths, and Land
Regarding the new currency’s backing, Babakov left the door open for a system anchored by gold as well as other commodities such as rare-earth elements or land. This modern commodity-backed approach echoes classic gold standard principles but is adapted for the digital age, aiming to reduce reliance on sovereign fiat currencies like the U.S. dollar and the euro.
A Multi-Polar Vision Through De-Dollarization
Babakov sharply criticized the current dollar- and euro-dominated system, arguing that these currencies “serve the interests of Washington and London rather than the broader global community.” He stressed that New Delhi, Beijing, and Moscow are “instituting a multipolar world endorsed by the majority of governments,” and that the new monetary framework “should be based on inducting new monetary ties established on a strategy that does not defend the U.S. dollar or euro, but rather forms a new currency competent of benefiting our shared objectives.”
With BRICS now accounting for more than a quarter of global GDP, the successful launch of a common currency could reshape the international monetary landscape. What are your thoughts on BRICS developing a shared currency? Let us know in the comments below.