National currencies free BRICS from Western pressure
Members of the economic bloc have accelerated efforts to reduce reliance on third-party currencies in bilateral trade in recent years, especially after Western sanctions led to the freezing of Russia's reserves held in dollars and euros following the escalation of the Ukraine conflict in 2022.
Speaking to RT on Sunday on the sidelines of the 17th BRICS summit in Rio de Janeiro, Siluanov said Moscow is ready to offer mechanisms to reduce the risks posed by sanctions. The issue was discussed earlier in the day at a meeting of the New Development Bank (NDB) governors. The financial institution was established by BRICS in 2015 to address the needs of developing countries.
Such mechanisms 'would not involve Western financial infrastructure or settlement in currencies of those countries that imposed sanctions on Russia and would secure the New Development Bank from possible risks,' Siluanov stated.
Commenting on the growing use of national currencies in BRICS trade, he said such settlements 'have proven their reliability and independence from Western lending institutions that at any moment, as it turned out, can suspend payments.'
Siluanov noted that transactions are being handled through reliable banks with direct correspondent ties, bypassing Western-controlled systems. Expanding these links, he said, is key to maintaining trade turnover and ensuring smooth settlements.
Since major Russian banks were cut off from SWIFT in 2022, Moscow and many of its trading partners have stepped up efforts to reduce exposure to the Western financial system. Banks and businesses have sought to use alternative financial and banking platforms, such as non-SWIFT money-messaging systems, and increasingly use national currencies in trade settlements.
As one example, Siluanov cited trade with China, saying turnover has increased and will likely continue to grow. Bilateral trade hit $245 billion last year, with nearly all transactions now conducted in rubles and yuan.
BRICS was founded in 2006 by Brazil, Russia, India, and China, with South Africa joining in 2010. Over the past year, Egypt, Ethiopia, the United Arab Emirates, and Indonesia have also become full members. At the group's summit in Kazan, Russia, last year, BRICS approved a new 'partner country' status in response to a growing membership interest shown by more than 30 countries.
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