BRICS and international multipolarity.

By: Dr. Hasan Abdullah Al Dajah

Professor of Political Science and Strategic Studies, Al-Hussein Bin Talal University – Jordan. Academic consultant of the Belt and Road Institute, BLCU Member of the World Council of Sinologists.

The “proposed BRICS” currency or any new developments of the BRICS member states (Brazil, Russia, India, China, and South Africa) are working to enhance economic and financial cooperation between them, but no common currency or “proposed BRICS” has been issued until then.

No one can accurately predict the fate of the dollar or the impact of any potential new currency on its strength. Financial markets and the economy is a complex, dynamic system that is affected by a wide range of factors, including monetary and fiscal policies, global economic turmoil, geopolitical developments, and other economic and trade factors.

If a new currency is issued by the BRICS alliance or any other alliance, this currency will have to prove itself in the global markets and win the confidence of investors and stakeholders. Its impact will depend on many factors, such as the strength of the economy of the member states of the coalition, their economic and monetary policies, their ability to conduct international trade, and the political and economic stability of those countries.

The dollar has a special place in the global economy as a reserve currency and unit of international settlement, and it has a great influence on financial markets and global trade. If any change occurs in this situation, it will have complex and difficult-to-predict effects.

The impact of the new currency on the dollar and countries linked to the dollar.  If a new currency is issued by a particular alliance, its impact will depend on a combination of factors including:

The size of the economy and the economic strength of the new currency: If the new currency belongs to a large and powerful economy, it may have the ability to influence the dollar and global markets more. However, the evaluation must also include other aspects such as debt, leverage, and trade.

Investor and financial market confidence: The impact of the new currency will also depend on how much confidence investors and financial markets have in this currency. If there is strong confidence in the economy and fiscal policies of the new currency, this could lead to less dependence on the dollar.

Monetary and financial policies: The monetary and financial policies of the country issuing the new currency will play a decisive role in determining its impact. Inflation, interest rate, and debt management policies will affect the strength and long-term sustainability of the currency.

International trade and international relations: The impact of the new currency may be related to its trade relations with other countries and its ability to achieve balance in transactions and reduce dependence on the dollar in trade.

Geopolitical changes: Global geopolitical and political changes may also affect the strength and stability of the new currency and thus its impact on the dollar. The potential impact of the new currency on the dollar and countries linked to the dollar must be evaluated through a comprehensive study of all these factors and many other factors.

The fate of the dollar: how will it withstand the new currency?

No one can accurately predict the fate of the dollar or the impact of any potential new currency on its strength. Financial markets and the economy is a complex, dynamic system that is affected by a wide range of factors, including monetary and fiscal policies, global economic turmoil, geopolitical developments, and other economic and trade factors.

If a new currency is issued by the BRICS alliance or any other alliance, this currency will have to prove itself in the global markets and win the confidence of investors and stakeholders. Its impact will depend on many factors, such as the strength of the economy of the member states of the coalition, their economic and monetary policies, their ability to conduct international trade, and the political and economic stability of those countries.

The dollar has a special place in the global economy as a reserve currency and unit of international settlement, and it has a great influence on financial markets and global trade. If any change occurs in this situation, it will have complex and difficult-to-predict effects.

The expected impact of the new currency on the dollar and on countries whose currencies are pegged to the dollar.

The issuance of a new currency by a specific alliance, its impact will depend on a group of factors that include:

The size of the economy and the economic strength of the new currency: If the new currency belongs to a large and powerful economy, it may have the ability to influence the dollar and global markets more. However, the evaluation must also include other aspects such as debt, leverage, and trade.

Investor and financial market confidence: The impact of the new currency will also depend on how much confidence investors and financial markets have in this currency. If there is strong confidence in the economy and fiscal policies of the new currency, this could lead to less dependence on the dollar.

Monetary and financial policies: The monetary and financial policies of the country issuing the new currency will play a decisive role in determining its impact. Inflation, interest rate, and debt management policies will affect the strength and long-term sustainability of the currency.

International trade and international relations: The impact of the new currency may be related to its trade relations with other countries and its ability to achieve balance in transactions and reduce dependence on the dollar in trade.

Geopolitical changes: Global geopolitical and political changes may also affect the strength and stability of the new currency and thus its impact on the dollar.

Avoiding the negative effects of the new global currency

Avoiding the potential negative effects of a new global currency includes several strategies and procedures that the BRICS countries and other countries can follow, and these are some of the ways that can help avoid these effects:

Diversifying the economy: diversifying the economy and diversifying sources of income can help reduce the impact of currency fluctuations. By relying on multiple sectors and diversifying exports and imports, countries can reduce dependence on one currency and reduce dependence on the new global currency.

Enhancing economic strength: Building a strong and sustainable economy enhances the strength of the national currency and makes it more stable. This requires implementing correct economic and financial policies and stimulating economic growth.

Improving monetary and fiscal policies: Implementing balanced and sustainable monetary and fiscal policies can limit the impact of currency fluctuations on the economy. Adjusting interest rates and careful debt management can help stabilize the currency.

Expanding trade partnerships: Developing trade partnerships with a variety of countries can help broaden the trade base and reduce dependence on a single currency.

Enhancing cash reserves: Building sufficient cash reserves can have a positive impact on the ability to deal with currency fluctuations and financial crises.

Investing in technology and innovation: Enhancing the ability to develop and use technology and innovation can contribute to increasing economic competitiveness and reducing dependence on other currencies.

Regional and international cooperation: Cooperation with other countries and participation in trade and economic agreements can support economic stability and contribute to achieving a better balance.

Managing economic transformations needs sustainable planning and implementation, and there are a variety of strategies that can help countries deal with any shifts in the economic system and global currencies.

The impact of the new currency on the economic sanctions imposed by America and Europe on many countries.

If a new currency is issued that replaces the dollar or any other currency as the global currency, this may have an impact on the economic sanctions that the United States, Europe, and others impose on other countries. Here are some points that can affect penalties:

Diversifying the currencies used: If countries are able to switch from using the dollar to the new currency as a means of trade and economic transactions, they may have greater flexibility in bypassing the sanctions imposed in dollars.

International trade and cooperation: If trade and economic alliances and partnerships are formed with countries that use the new currency, this could affect the ability to overcome the impact of sanctions.

Impact on the value of the currency and the economy: If the new currency enjoys strength and confidence in global markets, this may affect the economic and commercial value of the country targeted by the sanctions.

Geopolitical and economic alliances: States joining new economic or geopolitical alliances that use the new currency may enhance their ability to counter-sanctions.

Indirect exchanges: If alternative mechanisms such as indirect exchanges or direct exchange of goods are used, the target countries may partially avoid sanctions.

Impact on international laws and policies: Adoption of the new currency may lead to changes in international policies and laws related to sanctions and trade.

These points depend on the hypothesis of a new world currency and adopting it realistically. The factors surrounding the impact of the new currency on the sanctions will be complex and multiple, and other factors such as the general geopolitical and economic context may also have to be taken into consideration.

The positive effects of the new currency on the countries of the region, many of which have expressed their willingness to deal with the new currency.

Since the discussion about the new currency is only a hypothesis and there is no confirmed information, its positive impact on the countries of the region can vary greatly depending on many variables and specific factors.

In general, if the new currency is successfully adopted and used as a global currency, it may have some positive effects on the countries of the region, which have expressed their willingness to deal with it:

Improving the trade balance: If the new currency is strong and stable, it may help in enhancing the trade balance of importing countries, as it may facilitate trade with partners that use the same currency.

Strengthening the local economy: The ability to avoid sanctions and reduce dependence on the dollar may help boost the local economy and encourage national investment.

Strengthening regional cooperation: The new currency may allow countries in the region to enhance economic, commercial, and financial cooperation between them.

Reducing the impact of sanctions: If the new currency is used in contracts, trade deals, and international finance, it may help reduce the impact of economic sanctions on countries in the region.

However, many factors must be considered such as the strength and stability of the new currency, the policies of the countries involved, and the general economic and geopolitical conditions. There must be a careful assessment of the potential effects and advantages of the new currency on each individual country.

BRICS contributes to international multipolarity.

The BRICS group is an economic and political bloc that works to strengthen cooperation between these countries, which enhances their role in global economic and political matters. The BRICS group contributes in several ways to strengthening international multipolarity:

Diversification of economic sources: BRICS countries are characterized by large and diversified economies. Working together, these countries can promote mutual trade and investment, which enhances the diversification of global economies and reduces dependence on other large economies.

Strengthening multiple international relations: Through their cooperation, the BRICS countries contribute to strengthening their relations with other countries and international organizations. This could lead to the strengthening of balance in international relations and the strengthening of multipolarity.

Strengthening political cooperation: BRICS countries work together in international forums such as the G-20 and the United Nations Security Council. This cooperation can contribute to strengthening its political role and taking common positions on global issues.

Enhancing economic cooperation: BRICS countries are working to enhance trade exchange between them and to facilitate trade and investment. This can contribute to the diversification of markets and the strengthening of the participating economies.

Changing the rules of the international political game: it works to create a multipolar superpower led by China and to create a global system parallel to the West that imposes itself on the countries of the world that will seek to join it and thus establish a multipolar world, and end Western hegemony over the international system, especially after the collapse of the Soviet Union.

Finally: BRICS and ending the US political and economic hegemony

The BRICS group has the goal of strengthening international multipolarity and strengthening its role in world affairs. Thus, it may seek to reduce the political and economic dominance of the United States and other major powers. There are some ways in which BRICS could work on this:

Diversifying economies and international relations: By strengthening economic and trade cooperation between the BRICS countries, it is possible to diversify the economies of these countries and reduce their dependence on global markets dominated by the United States and Europe. This can strengthen the position of the BRICS and reduce the impact of the economic hegemony of the major countries.

Promoting multiple international relations: By cooperating with other countries and international organizations, BRICS can enhance its role in setting the global agenda and shaping international initiatives. This reduces the influence of the political hegemony of the major powers.

Strengthening bilateral cooperation and regional groups: In cooperation with other countries and other regions, BRICS can form alliances and partnerships that contribute to strengthening its regional and international role, and thus reduce the influence of hegemony.

Supporting international reforms: The BRICS countries are working to support reforms in international institutions such as the United Nations, the International Monetary Fund, and the World Bank, to ensure greater representation of emerging economies and developing countries and to reduce the great superiority of the United States and Europe.

Infrastructure and Technology Development: By investing in infrastructure and technology development, BRICS can enhance its economic and technological standing in the global arena.

Adopting common positions: By coordinating its positions in international forums such as the United Nations and the Group of Twenty, the BRICS can express its views and aspirations on international issues.

Develop joint projects: BRICS countries cooperate in areas such as infrastructure, energy, and technology. Develop joint ventures that can contribute to joint economic and technological progress.

Strengthening cultural and educational relations: By exchanging experiences and cultures and promoting education and scientific research, the BRICS countries can enhance their mutual understanding and bring their points of view closer.

The BRICS group in general contributes to strengthening international multipolarity by enhancing cooperation and interaction between its member states and strengthening its role in global matters, but this does not necessarily mean that it directly targets the United States or any other country in a negative way.

The views expressed in the article are the author’s own and do not necessarily reflect the editorial policy of the Global Silk Route Research Alliance (GSRRA).