China and Russia want to either use BRICS currencies to settle international trade or use a basket of BRICS currencies. Both plans are preposterous, because the Brazilian real, Russian ruble, Indian rupee, and South African rand are weak, non-convertible currencies that foreign countries do not want to hold in currency reserves.
Between June 2021and June 2022, the price of a barrel of oil more than doubled. During the same time period, the South African rand lost roughly 11% of its value against the dollar. If India had agreed to accept rand for its trade with South Africa, it would now be holding rand which Saudi Arabia would not except for oil purchases. Even if BRICS convinced Saudi Arabia to accept payment in rand, the cost of a barrel of oil, for India, would now be 111% higher than it had been in 2021.
#economy #china #india #Russia #ruble #BRICS #Currency
