The US dollar’s privileged role in international trade is gradually diminishing, and this is a positive development for the majority of countries worldwide, according to economist Rasigan Maharajh. Speaking at the Valdai Discussion Club meeting in Sochi, Maharajh argued that the dollar and the financial institutions tied to it have become outdated and should no longer be relied upon. He called for the creation of an alternative international payment system based on national currencies, which would value individual countries and promote mutual respect for their independence and autonomy.
Maharajh noted that as more countries use their national currencies in international trade, the value of these currencies increases while the credibility of the dollar declines. This shift is a natural consequence of current geopolitical conditions. He elaborated on the range of alternatives that exist and stressed the importance of a democratic and open international payment system that allows all countries to participate on an equal footing.
The economist also highlighted the negative impact of US monetary policies, particularly those determined by the US Federal Reserve, on developing countries. He argued that decisions made in Washington have significant repercussions for monetary policies in poorer nations, often leading to austerity measures and cuts in government spending. Instead of focusing on chasing returns on money, Maharajh emphasized the importance of prioritizing investments in infrastructure, healthcare, and education in developing countries.
Maharajh pointed out that the BRICS economic group, comprised of Brazil, Russia, India, China, and South Africa, has the potential to reshape the global economic order and empower the global majority. He praised the group for prioritizing the interests of their citizens over purely profit-driven motives, highlighting the importance of realizing the rights of the global majority. With the expansion of BRICS to include Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates next year, the bloc will become the largest economic union in the world, representing nearly 40% of global GDP.
In conclusion, Maharajh called for a shift away from the dominance of the US dollar in international trade and the establishment of an alternative payment system based on national currencies. He argued that this would provide greater autonomy and independence for individual countries and promote a more equitable global economic order. The economist expressed confidence in the potential of the BRICS group to bring about positive change and uphold the rights of the global majority.