As the BRICS (Brazil, Russia, India, China, and South Africa) organization gathers for meetings in Russia, the newest member, Iran, has called for the implementation of digital currency systems this year. Iran, along with other states facing Western sanctions, is emphasizing the importance of banking and payment-related agendas, particularly digital currencies.
BRICS expanded its membership, adding Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE. The inclusion of Iran, currently under Western sanctions, aligns with the increased focus on payment systems within the BRICS discussions.
While there has been previous speculation about the potential development of a common digital currency among BRICS countries, the concept was downplayed at the last summit in August. The emphasis shifted towards the use of local currencies for trade payments instead of the U.S. dollar.
Iran’s recent comments suggest a revived interest in the idea of a common digital currency. However, Russia, the current chair of BRICS, has expressed skepticism about the feasibility of a common currency in the past. The recent expansion of BRICS and interest from 20-30 additional countries in joining might impact the dynamics of this discussion.
During the opening meeting, Iran’s BRICS representative expressed hope for progress in economic and financial pillars, including banking and financial issues, payment systems, digital currency, common currency, and exchanges with national currency by 2024.
Russia’s Deputy Foreign Minister emphasized exploring ways to enhance the use of national currencies, payment instruments, and platforms to reduce dependence on the current dollar-dominated global economic system. The emphasis on “payment instruments” could indicate a broader scope for exploring digital payment solutions.
China, a key member of BRICS, underlined the need to expand settlements in local currencies and enhance linkages between payment systems. China’s interest in cross-border central bank digital currency (CBDC) projects, such as mBridge, aligns with its agenda within BRICS.
The discussions also touched on the New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA), aiming to strengthen both entities. China emphasized the importance of expanding cooperation in artificial intelligence (AI) and proposed the consideration of launching a BRICS AI development cooperation center in China.
While these discussions unfold, Brazil has suggested a need for focus amid the various proposals and agenda items being presented at the BRICS meeting. The diverse range of topics, including digital currencies, reflects the evolving economic and technological landscape within the BRICS nations.
