BRICS Sixteenth summit held in Kazan Russia during
22-24 October 2024 threw a bombshell. A SWIFT like system was unveiled. A
commonplace name of BRICS Clear might not sound impressive yet the business
strategy of it is definitely earth-shaking in terms of geoeconomics:
Originally formed as ‘BRIC’ by Brazil, Russia,
India & China and later morphed as BRICS with the admission of South Africa,
this new multi nodal organization was expanded as four more countries Egypt,
Ethiopia, Iran & United Arab Emirate joining in 2024 resulting in a
nomenclature BRICS+. The latest Summit
in Kazan opened BRICS door to new members who are at present called as ‘Partners’.
At the time of writing there are 13 countries designated as Partners, namely
Algeria, Belarus, Bolivia, Cuba, Indonesia, Kazakhstan, Malaysia, Nigeria Thailand,
Turkey, Uganda. Uzbekistan and Vietnam in alphabetical order.
The stated objective of the creation of a gateway as an alternative to
SWIFT called “BRICS Clear” is to promote bilateral and multilateral
transactions between and amongst the 9 BRICS full members and 13 BRICS partners
without going through the existing international transaction and payment route.
The hidden objective is that the new system facilitates transactions
in national currencies and settling of these transactions would via “Stable Coin”,
a new transaction currency that is to be administered by the ‘BRICS
Development Bank’.
The most hidden objective, however, is the avoidance of intermediation of Western countries and the use of US Dollar as trading currency.
What about marine and other trade related insurance? This aspect was also considered with a proposed Reinsurance scheme whereby national insurance companies would be able to insure their goods while in transit and be covered by the ‘BRICS Reinsurance Company’.
The expected trade volume would be initially 30% of
the global trade in the short term horizon and would move into the region of
above 50 % of the global trade as new partners are identified and brought into
the BRICS Family. A graduation
process is to be implemented where the countries in the pool of Partners
currently numbering 13 would be admitted as full members and when they meet up
the criteria of selection hereinafter to be negotiated with each individual
natio
In sum, the threat looms for the America led West in their domination of global wide trading facilitation. Double whammy is delivered both in currency and insurance in one go!
Cheers!
Muthu Ashraff Rajulu
Business Strategist
Mobile: + 94 777 265677
E-mail: cosmicgems@gmail.com
Blog: Business Strategist
