Iran Welcomes BRICS Common Currency, Challenges US Dollar

Orinoco Tribune, July 10, 2023 —

Iran backs the BRICS plan to use a common currency in their trade, stressing that the move will challenge the dominance of the US dollar and the euro.

On July 9, the head of the South Asia Department of Iran’s Foreign Ministry, Seyed Rasul Mousavi, said that the BRICS group (Brazil, Russia, India, China and South Africa) introduction of a gold-backed currency will weaken the dollar and the euro, as well as benefiting countries like Iran.

He emphasized that “there is a tremendous change taking place in the international economy.”

The BRICS group of emerging economies recently announced plans to create a gold-backed currency to settle international trade payments, with the aim of challenging the global reserve status of the US dollar.

The five-nation bloc is expected to decide on introducing the new common currency during its upcoming summit in Johannesburg, South Africa, in August.

As the Minister of Integration and Macroeconomics of Russia’s Eurasian Economic Commission, Sergey Glaziev, explained last June, it will be a new digital currency based on the group’s national currencies.

Currently, the members of the BRICS account for more than 20% of the world’s Gross Domestic Product (GDP) and 42% of the global population. Several countries, including Iran, Argentina, Saudi Arabia, Algeria, Egypt, Indonesia and Turkey, have expressed interest in joining the alliance.

The news comes as the global trend to replace the US dollar with local currencies in the trade of goods and transactions has been increasing, with countries hoping to reduce their dependence on Washington.

Although many economists say that no other currency can dominate the US dollar in the short term, other experts, like Nouriel Roubini who predicted the 2008 financial crisis, do not rule out the eventual disappearance of the dollar as a reserve currency within a decade.