Not easy to make Brics draft on int'l payment systems work

Astute businessmen and finance executives would have taken note of four initiatives the leaders of Brics, a grouping of nine countries, proposed when they met last week at Kazan, Russia: more trade between the Brics member countries, payments in national currencies of Brics member countries, an electronic platform for settlement of interbank transactions and a new currency to facilitate transactions and build up of reserves.

- T N C RAJAGOPALAN

They would have perceived such proposals as easy to conceive and talk about rather than made to work in practice.

Brics, originally a grouping of Brazil, Russia, India, China and South Africa, admitted four new member countries—Iran, Egypt, Ethiopia and the United Arab Emirates (UAE)—this year, and more countries are expected to become part of this grouping in the coming years, including some who attended the Kazan conference this year as invitees.

Their political motivations apart, all of them share a grievance that the United States and its allies abused their dominance in global trade and finance institutions and monopoly in inter-bank payment settlement mechanisms.

The ideas floated last week at the 16th annual Brics conference intend to challenge the primacy of the US dollar in which most international payments are settled and reserves held.