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Highlights
- Russia affirms it won’t abandon the US dollar but will reduce its use as a settlement tool within BRICS' de-dollarization efforts.
- BRICS is developing a unified payment system leveraging local currencies to enhance financial autonomy and reduce dollar reliance.
- Trump’s re-election strengthens the dollar, posing a challenge to BRICS' de-dollarization.
Russian President Vladimir Putin addressed Russia’s position within the BRICS alliance regarding using the U.S. dollar. Contrary to the BRICS bloc’s ongoing de-dollarization efforts, Putin clarified that Russia is not planning to abandon the dollar entirely but will limit its use as a settlement currency. Describing the dollar as a “pillar of U.S. power,” Putin highlighted that the global trend toward alternative currencies is just a response to evolving economic dynamics.
Vladimir Putin Confirms Russia Won’t Ban Dollar
In a recent interview, Vladimir Putin affirmed that Russia will not completely abandon the U.S. dollar, despite ongoing de-dollarization discussions within BRICS. Instead, Russia aims to reduce the dollar’s role in transactions, focusing on using it sparingly in global settlements. Putin stated that while payments in dollars are gradually decreasing, the move is part of a natural shift driven by changing global economic conditions rather than an outright dismissal of the U.S. currency.
Simultaneously, BRICS continues working on a unified payment system to reduce reliance on the dollar. This new system, rooted in the payment networks of each member country, will facilitate financial autonomy by enabling transactions in local currencies. The initiative is part of the bloc’s goal to strengthen its financial infrastructure.
The Russian president insisted,
“Our proposals are not aimed against [the] dollar. This is simply us rising to the challenge of modern times, in response towards the development of the economy we are thinking about.”
Trump’s Policies Challenge BRICS’ Dollar Strategy
However, the re-election of Donald Trump could influence the future of BRICS’ de-dollarization strategy. During his campaign, Trump emphasized the importance of preserving the U.S. dollar’s global role, warning that countries moving away from the dollar may face tariffs on their goods. This stance could create obstacles for BRICS nations seeking to diversify away from the dollar.
Therefore, under Donald Trump’s administration, efforts to strengthen the dollar might pose challenges for the BRICS bloc as it attempts to create alternatives. Despite these potential hurdles, BRICS leaders, including Vladimir Putin, are committed to exploring different currency strategies.
In one of his campaign rallies in September, Donald Trump said,
“Many countries are leaving the dollar. They not going to leave the dollar with me. I’ll say, you leave the dollar, you’re not doing business with the United States because we’re going to put 100% tariff on your goods.”
Moreover, discussing future financial strategies, Vladimir Putin hinted at potential roles for digital currencies like Bitcoin and XRP within BRICS. While the adoption of these cryptocurrencies remains in the early stages, Putin acknowledged the interest in exploring digital assets.
However, he emphasized that a full transition to cryptos is premature, and the focus remains on national currencies. Consequently, the president said member countries are prioritizing the development of a robust banking network to support intra-BRICS trade.
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