• At a summit being held in Russia, foreign affairs ministers from BRICS nations are meeting to discuss a number of issues.
• One of these issues is improvements to the international monetary and financial system.
• This includes more trade using local currencies and enhancing the interconnectivity of supply chains and payment systems between BRICS members.

A delegation of BRICS nations is currently meeting in Russia to discuss a number of points, including the expansion of BRICS to include new members from the global South, as well as new financial and economic cooperation opportunities between member states.

This includes the establishment of a “Task Force” to prepare a “BRICS Report on Improving the International Monetary and Financial System” of which South African officials will be part, according to foreign affairs minister Naledi Pandor who spoke at the summit on Tuesday.

“South Africa supports efforts to improve the stability of the International Monetary and Financial System, particularly through enhancing the interconnectivity of supply chains and payment systems to promote trade and investment among BRICS members and the broader global South,” said Pandor.

What this “improvement” is exactly has yet to be expounded upon, but what is known is that the international monetary system is dominated by the US dollar and trade using the currency.

The upcoming task force is likely looking into developing a BRICS-only independent payment system away from the US dollar exchange – one that would benefit developing nations in the economic alliance like India and South Africa.

Russian President and International Criminal Court fugitive Vladimir Putin admitted so much during a speech at the 12th Saint Petersburg Economic Forum on Tuesday. Putin said that this new international payment system would be “unmoved by political pressure, abuse and external sanctions”.

This external pressure of course makes reference to NATO-allied nations, including the United States.

According to Indian publication Business Standard, the foreign ministers that are attending the summit this week have made several proclamations highlighting the importance of using local currencies in trade and in financial transactions among BRICS nations in particular.

Whatever system emerges from BRICS to support inter-member transactions, it will likely be supported digitally in some way. In March, the Kremlin issued a statement that Russia was already working on a blockchain-based payment system exclusively for BRICS members.

“We believe that creating an independent BRICS payment system is an important goal for the future, which would be based on state-of-the-art tools such as digital technologies and blockchain,” explained Kremlin aid Yury Ushakov.

“The main thing is to make sure it is convenient for governments, common people and businesses, as well as cost-effective and free of politics,” they added.