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30 Countries Participate to Ditch the U.S. Dollar as Global Reserve Currency

• LinuxBender 3y ago
  According to the latest report, the BRICS alliance has formally received applications from 25 countries to join the bloc. The 25 nations that expressed their interest to join are Afghanistan, Algeria, Argentina, Bahrain, Bangladesh, Belarus, Egypt, Indonesia, Iran, Kazakhstan, Mexico, Nicaragua, Nigeria, Pakistan, Saudi Arabia, Senegal, Sudan, Syria, the United Arab Emirates, Thailand, Tunisia, Turkey, Uruguay, Venezuela, and Zimbabwe. Most of these are not surprising but Mexico would be an interesting inclusion given their trade agreement with the US. [1] Is that deal falling apart or does this not create a conflict? [1] - https://www.trade.gov/north-american-free-trade-agreement-nafta https://www.trade.gov/north-american-free-trade-agreement-na...
  • anonymouskimmer 3y ago
    Why would it create a conflict? There isn't a single reserve currency in the world now, nor a single trade group.
    • LinuxBender 3y ago
      Maybe it doesn't. Some of the countries listed are embargoed meaning their trade agreements would be with countries that the US blocks. I've never dug into how that works. Perhaps that is how countries work around embargoes.
      • anonymouskimmer 3y ago
        Working together with a common currency doesn't mean countries will trade with each other. But yeah, I think this would help some countries by creating an international banking system that they are allowed to use.
    • SkyPuncher 3y ago
      I see it as a mild conflict. Not meaningful, but surely something that is used as leverage. Mexico seems to want to become the China of North and Central America. They see that US companies that want a less authoritarian government controlling their manufacturing centers. In other words, Mexico want to tie itself to US companies. This signals conflicting messages between wanting to be a major US trading partner and not wanting it to be the global currency.
• anonymouskimmer 3y ago
  > If all these countries trade with the BRICS currency ending reliance on the U.S. dollar, the greenback could be hit. The United States will find no means to fund its deficit and the economy could begin to crumble. The US has a large deficit with China, and a noticeable one with Mexico, but this statement seems hyperbolic. Mexico could very well join another international currency system, but it is likely too tied to the US to abandon the US dollar as a reserve currency. https://worldpopulationreview.com/country-rankings/us-trade-deficit-by-country https://worldpopulationreview.com/country-rankings/us-trade-... Here's Patrick Boyle's take on a BRICS reserve currency. It's been a month since I watched it so can't summarize it now: https://www.youtube.com/watch?v=JHZnVdBZJfA https://www.youtube.com/watch?v=JHZnVdBZJfA
• seanmcdirmid 3y ago
  The RMB is still not fully convertible, so its use in trade is limited. The USD is convenient because it always has a highly reliable debtor of last resort (the USA government) willing to soak up billions of dollars that you might not want floating around in your own economy. As long as the dollar is so liquid while other currencies are less so, it is hard to see it being ditched even by China.