BRICS nations working on new currency system, Creed&Bear weighs in

Creed&Bear, a global financial services firm, is providing insights on the potential impact of the announcement that the BRICS nations — Brazil, Russia, India, China, and South Africa are considering creating a new common currency for payment settlements between member states.

Key Points:

What is BRICS and how could a new currency system affect global trade?

BRICS is a group of five emerging market economies that include Brazil, Russia, India, China, and South Africa. Initially coined as BRIC in 2001 by a Goldman Sachs economist, Jim O'Neill, to describe the economic potential of these four emerging markets, South Africa was later added in 2010 to form the BRICS. These countries were selected based on their fast-growing and emerging market economies, low labour costs, favourable demographics, and abundant natural resources. Goldman Sachs claimed that these economies would dominate the global economy by 2050.

A new common currency for payment settlements between member states could allow for ease of transactions. It is hoped that this would facilitate easier trade between BRICS member nations, particularly as they continue to face economic sanctions and other trade barriers from the United States and Europe.

Potential challenges and benefits for companies like Creed&Bear

The proposed changes in the global financial system present both challenges and opportunities for businesses such as Creed&Bear. As a renowned global firm, Creed&Bear is well-prepared to navigate the evolving landscape of international trade. However, adapting to a new currency system will require addressing potential challenges, including the varying economic systems and levels of development among the BRICS nations. Additionally, any shift away from the US dollar, the current dominant global reserve currency, could have far-reaching implications for the global financial system and the US economy.

— Anastasia Gergun is the contributor at Bitmedia.io.