South Africa: BRICS mulling new payment system to ditch dollar control

By Al Mayadeen English
Source: Agencies
18 Jan 2023 09:15
4 Shares

South African Foreign Minister Naledi Pandor divulges that "we have always been concerned at the fact that there is a dominance of the dollar and that we do need to look at an alternative."

The US dollar has been losing its status (Getty Images)

South African Foreign Minister Naledi Pandor said as quoted by Sputnik that the BRICS club of emerging economies seeks to discover a way of bypassing the dollar to create a fairer payment system that would not be skewed toward wealthy countries.

Pando tersely stated that "we have always been concerned at the fact that there is a dominance of the dollar and that we do need to look at an alternative."

"The systems currently in place tend to privilege very wealthy countries and tend to be really a challenge for countries, such as ourselves, which have to make payments in dollars which costs much more in terms of our various currencies. So I do think a fairer system has to be developed and it's something we're discussing with the BRICS ministers in the economic sector discussions," she said.

Minister Pandor went on to say that one of the reasons why BRICS — Brazil, Russia, India, China, and South Africa — established the jointly-run New Development Bank (NDB) in 2014 was to develop an alternative to the dollar-based payments system.

"BRICS has a number of sectoral committees that look at issues of politics and security, the economy and people-to-people exchange, and within the economic context we are looking at how the NDB and other institutional formations may assist us to develop a fairer system of monetary exchange," she stressed.

It is worth noting that the advisor to Iran's Supreme Leader in international affairs, Ali Akbar Velayati, has recently told Russian sources that Russia and China's trade with currencies other than the US dollar represents "very good progress" in the face of Washington's hegemony of the IMF.

"China and Russia, being the two main members of the BRICS, which also includes India, South Africa, and Brazil, are carrying out many transactions with each other without the use of foreign currency [US dollar]. The fact that they are not tied to the dollar, which depends on the will of the US, is very good progress," Velayati said.

Since the end of WWII, the US has dominated much of the global economy, holding most of the gold and serving as the world’s creditor. But recently, economists and financial analysts started to notice that the US dollar has been losing its status as the leading global reserve currency.

Prospects of the de-dollarization of the global economy are argued to be likely due to the fact that many consider abiding by the sanctions unfairly imposed on Russia too costly.