In a bid to challenge the dominance of the U.S. dollar, BRICS countries have proposed the introduction of a new currency to settle international trade. This move could set in motion an upheaval that would replace it from its current global reserve status – inspiring other nations in the Eastern bloc to promote their native currencies for global trading purposes. An increasing number of countries may soon join forces and abandon reliance on the American tender altogether should this trend carry on gaining strength.
At a meeting of Association of Southeast Asian Nations (ASEAN) members, 10 nations from Southeast Asia resolved to support their own currencies in cross-border transactions. Thus, they will no longer be required to settle payments with U.S. dollars but rather use their local currencies for transactions with each other.
In order to promote economic and financial transactions, a coalition of nations has decided to support local currencies over U.S. dollars. This consortium of 10 countries includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam.
By signing a declaration, nations belonging to ASEAN have taken a step to eliminate reliance on U.S. dollars and increase their domestic currencies. Aiming for stronger bilateral and multilateral payments, these countries agreed that transactions in local currencies are a more efficient, cost-effective way of concluding deals compared to using American money.
In order to bolster economic integration, 10 Eastern nations have accepted a collective resolution. This ASEAN Leaders Declaration aims to strengthen regional payment connectivity and facilitate local currency transactions via fast, convenient, and cost-efficient cross-border payments. Specifically, this commendable edict reads: “We adopted… advancing regional payment connectivity and promoting local currency transaction to foster bilateral and multilateral payment connectivity arrangements to strengthen economic integration by enabling fast, seamless, and more affordable cross-border payments across our region.”
To sum up, not only the BRICS countries but also ASEAN nations are phasing out the use of the U.S. dollar. Evidence suggests that even the Gulf Cooperation Council (GCC) is taking steps to put an end to America’s currency hegemony. Find out why this shift is occurring by reading here for more comprehensive information on oil-rich Gulf states’ plans.
