BRICS news and updates

BRICS has unveiled significant details about its new payment system, aimed at enhancing financial cooperation among its member countries—Brazil, Russia, India, China, and South Africa. This initiative is part of a broader strategy to reduce reliance on the US dollar and challenge the dominance of Western financial systems like SWIFT.

Key Features of the BRICS Payment System​

• Decentralization: The system is designed to distribute financial flows among multiple participants, minimizing the risk of central failures and enhancing stability and transparency
• Interoperability: Utilizing open APIs, the BRICS payment platform will allow seamless transactions across different payment systems, enabling faster and more secure fund transfers
• Digital Currencies: Settlements will be conducted using national currencies or a new digital currency developed specifically for BRICS. The platform will support transactions in local currencies, facilitating easier cross-border trade without needing to convert to US dollars
• Blockchain Technology: The payment system will leverage blockchain to ensure secure and transparent transactions. This technology aims to streamline processes that traditionally involve multiple intermediaries, thus speeding up transaction times significantly
  
  

  Adoption and Impact​

  • Widespread Interest: Reports indicate that 159 countries are interested in adopting this payment system, highlighting its potential to reshape global trade dynamics and enhance economic sovereignty for participating nations
  • Launch Timeline: The BRICS payment system is expected to be officially launched at the upcoming BRICS summit in October 2024. This timing aligns with ongoing discussions about enhancing financial independence from Western systems

Strategic Importance​

The establishment of this payment system is seen as a crucial step for BRICS nations to bolster their economic ties and facilitate smoother trade interactions. By promoting local currency usage and reducing transaction costs, the BRICS payment platform could significantly alter the landscape of international finance, particularly for countries seeking alternatives to Western-dominated financial mechanisms.

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[sidkhan2]

Sri Lanka has officially announced its intention to apply for membership in the BRICS group, which includes Brazil, Russia, India, China, and South Africa. This decision was communicated by Sri Lankan Foreign Minister Vijitha Herath, who stated that the application will be submitted during the upcoming BRICS summit in Kazan, Russia, scheduled for October 23-24, 2024.

Objectives of Membership​

The move to join BRICS reflects Sri Lanka's desire to strengthen ties with emerging economies and diversify its international relationships. Herath emphasized that BRICS represents an effective platform for fostering mutually beneficial cooperation, peace, and development through inclusive multilateralism. The country aims to enhance its engagement with developing economies and align itself with a group that seeks to challenge the dominance of Western financial institutions.

Representation at the Summit​

Due to upcoming parliamentary elections in Sri Lanka, neither Foreign Minister Herath nor President Anura Kumara Dissanayake will attend the summit. Instead, Sri Lanka will be represented by First Deputy Foreign Minister Aruni Wijewardane, who will formally lodge the application for membership. Herath has already reached out to counterparts in BRICS member states to garner support for Sri Lanka's bid.

Context of BRICS​

BRICS was originally formed as BRIC in 2006 and expanded to include South Africa in 2010. The organization aims to enhance economic cooperation among its members and increase their political influence on the global stage. Recently, BRICS has welcomed new members, including Iran and Saudi Arabia, as part of its strategy to create a multipolar world order.Sri Lanka's application is a significant step as it seeks to navigate its post-economic crisis landscape while aligning with nations that share similar developmental aspirations. The upcoming summit in Kazan will be a crucial platform for Sri Lanka to present its case for membership in this influential block.

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