According to a former White House economic advisor, a BRICS-issued currency may challenge the US dollar’s supremacy in international trade.
According to Joseph Sullivan in a new Foreign Policy piece, a BRICS-issued currency would allow its members – Brazil, Russia, China, India, and South Africa – to abandon the dollar and trade goods and services using the new currency, dubbed “the bric.”
According to Sullivan, who served in Trump’s administration, the BRICS might steal the “dollar’s place on the throne” since the BRICS are economic heavyweights in their respective regions.
According to the economist, the bric might be the beginning of the end of the dollar’s rule.
“Is it realistic to expect the BRICS to rely solely on the bric for trade?” Yes.
For instance, they could cover the entire cost of their imports on their own. In 2022, the BRICS collectively ran a trade surplus, also known as a balance of payments surplus, of $387 billion, owing primarily to China.
The BRICS would also be positioned to reach a level of international trade self-sufficiency that has eluded the world’s other currency unions.”
In terms of the US government’s reliance on the dollar to keep other countries in line, Sullivan believes that the reaction of other countries to the financial sanctions placed on Russia shows that the weaponization of the USD will grow increasingly ineffective.
Although Sullivan believes that the bric has the potential to dethrone the dollar, he believes that it will take time.
“The dollar’s reign is unlikely to end overnight, but a bric would begin to erode its dominance gradually.”