The US Dollar and the BRICS Challenge E-Book

Hermann Selchow

• Herausgeber: tredition
• Kategorie: Geisteswissenschaft
• Sprache: Englisch
• Veröffentlichungsjahr: 2024

Seitenzahl: 286

Beschreibung

Discover the future of global finance! The US Dollar and the BRICS Challenge takes you into the world of unprecedented global economic change and geopolitical tensions. This book offers an in-depth analysis of the emerging forces that are reshaping the world's financial system. The US Dollar and the BRICS Challenge examines the dynamics between the traditional financial powers and the emerging BRICS countries (Brazil, Russia, India, China and South Africa) and shows how these countries are challenging the US dollar as the dominant world currency. What to expect: Historical context: Understand the historical roots and development of the US dollar into the global reserve currency. BRICS strategies: Learn how the BRICS countries are combining their economic power and developing alternative financial instruments and institutions. Future scenarios: Analyze the possible developments and consequences of a multipolar financial order. This book is an indispensable work for economists, finance experts, students of international relations and anyone interested in the future of the global economy. It provides sound insights and forecasts based on current data and extensive research. Why you should read this book: Current and relevant: Stay informed about the latest trends and developments in global financial policy. Fundamentally sound: Benefit from in-depth analyses and clear explanations of complex relationships. Forward-looking: Prepare for the financial challenges and opportunities of the coming decades. Reach out to "The US Dollar and the BRICS Challenge" and be one step ahead in the changing world of international finance. Become part of the dialogue about the future of our global economy! Hermann Selchow

Leseprobe

The US Dollar and the BRICS Challenge –

Towards a new global financial order

© 2024 Hermann Selchow

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tredition GmbH, Heinz-Beusen-Stieg 5, 22926 Ahrensburg, Germany

Das Werk, einschließlich seiner Teile, ist urheberrechtlich geschützt. Für die Inhalte ist der Autor verantwortlich. Jede Verwertung ist ohne seine Zustimmung unzulässig. Die Publikation und Verbreitung erfolgen im Auftrag des Autors, zu erreichen unter: tredition GmbH, Abteilung "Impressumservice", Heinz-Beusen-Stieg 5, 22926 Ahrensburg, Deutschland

The US Dollar and the BRICS Challenge –

Towards a new global financial order

"The value of money lies not in the coin or the bill,

but in the faith we place in it."

Ralph Waldo Emerson

Table of contents

Prolog

The shifts in power relations caused by the BRICS Countries

The exit from the Petrodollar and its impact on world trade

Reasons for oil-producing countries to join BRICS:

The challenge of Dollar dominance

The emergence of the BRICS Countries

The economic potential of the BRICS Countries

Challenges to the dominance of the US-Dollar

Potential for cooperation and synergies

The Bretton Woods System

The role of the Dollar in the international financial system

The Petrodollar System and the BRICS-Countries

The challenges and criticisms of the Petrodollar system

The BRICS Countries as an alternative to the US-Dollar

Reasons for developing countries to turn their backs on the US Dollar

The motivation of the BRICS Countries

The cooperation of the BRICS Countries in the financial sector

The impact of the BRICS Countries on the global economy

China’s role for the BRICS Countries

Russia’s role for the BRICS Countries

Brazil’s role for the BRICS Countries

India’s role for the BRICS Countries

South Africa’s role within the BRICS Countries

The geopolitical implications of the BRICS Countries

Security and independence of the BRICS Countries

The challenges to US-Dollar dominance by the BRICS Countries

The role of US big business

Military and political influence

The security cooperation of the BRICS Countries

The future of the BRICS Countries and the international financial system

The US reaction to the BRICS Countries

The BRICS Countries and regional integration

The BRICS Countries and sustainable development

The BRICS Countries and the Mercosur Alliance

The BRICS Countries and trade with the EU

The BRICS Countries and the self-image of the USA

Afrexim Bank, the US Dollar and the BRICS

The outlook for the US Dollar and the BRICS Countries

Closing words

Prolog

Continuous change and rapid technological progress raises the question of the stability of our future and of the global financial system. This book, "The US Dollar and the BRICS Challenge," addresses this issue in a comprehensive manner. It examines the historical dominance of the US dollar and sheds light on the emerging challenge posed by the BRICS countries (Brazil, Russia, India, China and South Africa), which are increasingly positioning themselves as a counterweight to the traditional economic power centers.

Since the introduction of the Bretton Woods system in 1944, the US dollar has played a central role in international trade and financial policy. The establishment of the dollar as the reserve currency created a foundation for decades of economic stability and growth, at least in the Western Hemisphere. But over time, cracks in this system began to become visible, particularly due to economic and political tensions, the financial crisis of 2008 and the steady increase in US national debt.

The BRICS countries have not only developed enormously economically over the past two decades, but have also gained political importance. With their considerable resources, large populations and growing markets, they are increasingly challenging the dominance of the established Western economic powers. Their ambition to promote a multipolar world order is reflected in the creation of new financial institutions such as the New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA), which are designed as alternatives to the International Monetary Fund (IMF) and the World Bank.

This book analyses the economic and political strategies behind the rise of the BRICS countries and examines their potential impact on the future role of the US dollar in the global financial system. It highlights the various mechanisms and instruments that these countries use to strengthen their position on the world stage and reduce dependence on the dollar. It also examines in detail the role of trade agreements, investments in infrastructure and technology and the development of alternative payment systems.

Another central theme of this book is the examination of the geopolitical implications of a possible shift in global financial power. The competition between the USA and the BRICS countries is reflected not only in economic tensions, but also in security and diplomatic tensions. The question of whether a new world order in which the US dollar no longer plays the dominant role will lead to more stability or new conflicts is of utmost relevance.

This new edition takes into account current developments and data up to and including 2024 in order to paint the most precise picture of the current situation possible. Numerous expert interviews and case studies complement the theoretical analyses and provide insights into the practical implementation and challenges facing the BRICS countries.

I would like to thank all those who contributed to the creation of this book. Their commitment and expertise have made a significant contribution to making this work a well-founded and worthwhile analysis of global financial dynamics. My special thanks also go to the readers, whose interest and critical engagement with the contents of this book make a valuable contribution to the discussion about the future of our global financial system.

I hope that this book will not only help to clarify many questions, but also open up new perspectives and encourage people to continue to closely follow and question developments in the international financial world.

The BRICS summit took place in August 2023. The five BRICS states are still planning - so it is rumored - their own gold-based reserve currency. This rumor is supported by several events. The world is currently experiencing massive structural changes. NATO is expanding further eastwards and northwards in Europe. A direct consequence of NATO's eastward expansion is the military conflict in Ukraine. In Africa, more and more countries are fighting back against their former colonial powers. Military coups, such as in Niger and Gabon, are overthrowing civilian governments that conform to the West.

In addition, other oil-producing countries are joining the BRICS group on the occasion of the BRICS summit mentioned above. These include countries such as Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates. These countries plan to trade their oil in currencies other than the petrodollar. This would lead to a further weakening of the US dollar.

Russia has been excluded from the SWIFT system. For Russia, exclusion from the SWIFT system means that Russian banks can no longer communicate directly with other international banks to process cross-border transactions. Without access to the SWIFT network, Russia is cut off from most international payment and settlement systems. This could make trade with other countries more difficult and affect economic relations. Such isolation should destabilize Russian financial markets and reduce the confidence of investors. Exclusion from the SWIFT system is a serious measure and should be understood as a means of political pressure.

It is therefore not surprising that the rumor of a new reserve currency - possibly backed by the Yuan - is being fueled. Added to this is the apparently unsuccessful visit of the American Secretary of State Blinken to China. Immediately afterwards, the stock market value of the US dollar fell by several points. China holds immense dollar reserves due to its export surplus.

After that, former US Secretary of State Henry Kissinger visited China, of course privately and without any diplomatic mission.

Henry Kissinger, now 100 years old, is highly respected in China, mainly because of his role in normalizing relations between the United States and the People's Republic of China in the 1970s. As then US Secretary of State, he played a crucial role in the secret negotiations with Chinese leader Zhou Enlai.

It remains to be seen whether his visit can dissuade China and the BRICS countries from their financial plans. Russia and China are among the top four countries in the world when it comes to buying gold. Brazil increased its gold reserves by 53.75 tons in the second quarter of 2021, almost doubling its stocks. India is quite well represented with 787.40 tons of gold reserves and has acquired more than 150 tons in recent years.

China stores 2,010.51 tons of gold. The country is also the largest gold producer in the world, accounting for around twelve percent of global production. However, Russia has the largest gold reserves with 2,301.64 tons and has spent the equivalent of around 36 billion euros over the past five years to increase its reserves and thus be less dependent on the US dollar. This has even overtaken China. The Russian gold industry is worth billions, so not much gold even needs to be imported. The country's gold reserves rose by 6.22 tons in the third quarter of 2021. The BRICS countries can use this gold to become largely independent of the dollar.

China also holds immense dollar reserves. If China were to sell its immense dollar reserves, it would have a significant impact on the global economy and financial markets. Selling large amounts of US dollars would reduce the value of the dollar against other currencies due to an oversupply. A devaluation of the US dollar would have far-reaching effects on the international trading community, especially on countries that are heavily dependent on trade with the US. On the other hand, China is also dependent on the US, as it exports a large proportion of its goods to the US. A sudden devaluation of the US dollar could affect the competitiveness of Chinese exports, as they would become more expensive for US customers. This would have a negative impact on Chinese economic growth. Selling dollar reserves could therefore also result in losses for China if the dollar depreciates during the sale.

However, the global economy is a complex network that is influenced by various actors and circumstances. In recent decades, the dominance of the US dollar as the world reserve currency has played an important role. The dollar has shaped the international trade landscape for many decades and has had a significant impact on geopolitical relations. But in recent years, new powers have risen and challenged the status quo. The BRICS countries - Brazil, Russia, India, China and South Africa - have gained increasing economic importance and are pushing for reform of the international financial system.

My book "The US Dollar and the BRICS Challenge" aims to bring readers closer to the history of dollar dominance and the emerging BRICS countries as a possible counterweight. It is intended to be seen as an attempt to shed light on current events in the world and thus help to better understand the current upheavals and restructuring. The book sheds light on the background that led to the power struggles of this time and it takes a look into a possible future to analyze the effects on the global economy. It will examine the various aspects of the topic, from the historical events that led to the emergence of dollar dominance to the current efforts of the BRICS countries to escape this dominance and strengthen their own position.

We will examine the roots of dollar dominance. From the Bretton Woods Conference in 1944 to the abolition of the gold standard in 1971, the key milestones on the way to the global acceptance of the dollar as a reserve currency will be covered. The role of the United States as a superpower and its economic and political interest in maintaining dollar dominance will also be questioned.

Another part of the book is devoted to the BRICS countries and their rise as economic heavyweights. Each country is considered individually to analyze its specific economic, political and social developments. All five countries have different challenges and opportunities, but all strive to have their own voice in the global economic order. Their efforts to build alternative currency and financial structures will also be examined in detail.

In addition, the conflicts and tensions between the US dollar and the BRICS countries are examined in more detail. I want to show how the United States is defending its dominance in the world economy by all means and is taking measures to maintain the status of the dollar. At the same time, the BRICS countries are forming their own economic alliance and are looking for ways to escape dependence on the dollar. This struggle for power and influence has an impact on global stability and will possibly lead to a redesign of the international financial architecture.

Furthermore, a look ahead is given. What might the world economy look like in the next few decades? What role do the BRICS countries and the dollar play? What scenarios are conceivable and how might they affect the various players? These questions are discussed on the basis of current developments and trends, with both optimistic and pessimistic scenarios being examined.

It is important to point out that this book cannot provide definitive answers. The dynamics between the US dollar and the BRICS countries are too complex and multi-faceted, and developments are still ongoing. Rather, this book aims to encourage people to think about the current world order and the possible changes that directly affect each and every one of us. This book offers a wealth of information, analyses and perspectives that enable the reader to form their own opinion and stimulate further discussions.

The dominance of the dollar and the emerging BRICS states are a topic that concerns not only economic and financial experts, but all of us. The decisions that will be made in the coming years could have a lasting impact on the global economy and realign geopolitical relations. It is up to us to understand these developments and to participate actively in them. It is up to us to connect the connections between the current events that directly affect and surround us with these global events. We must understand that current developments in politics and the economy are directly related to the struggles between the two opponents.

This book is an invitation to deal with this topic and take a look behind the scenes of the global economy.

It is an invitation to discover the history, present and future of dollar dominance and the BRICS states. It is important to me to invite you to immerse yourself with me in this world, which is full of challenges, opportunities and uncertain prospects. Decisions that could be made by the two opponents in this regard affect each and every one of us directly - so we should strive to understand them, discuss them and, if necessary, influence them.

Hermann Selchow

The shifts in power relations caused by the BRICS Countries

Over the past few decades, global power relations have changed dramatically. These shifts have been largely driven by the economic and political rise of the BRICS countries: Brazil, Russia, India, China, and South Africa. These nations have not only increased their economic power, but have also significantly expanded their political and cultural influence on a global scale. This chapter examines the various facets of these power shifts and analyzes the long-term implications for the global order.

The BRICS group emerged as a concept in the early 2000s and was popularized by British economist Jim O'Neill. Originally known as BRIC before South Africa joined in 2010, this group of emerging economies symbolized the potential for strong economic growth outside the traditional Western powers. The emergence of the BRICS countries marks the beginning of a new era in which economic dominance is no longer held exclusively by the G7 nations.

The economic strength of the BRICS countries has increased significantly over the past two decades. China and India are experiencing impressive growth rates and are now among the largest economies in the world. Russia's vast reserves of natural resources, Brazil's agricultural capabilities and South Africa's role as a gateway to Africa complement this economic potential.

China has established itself as the world's second largest economy and aims to overtake the US in the foreseeable future. The Belt and Road Initiative (BRI) is a clear sign of China's ambition to expand its economic and geopolitical reach. By building infrastructure in Asia, Africa and Europe, China is promoting international trade and cementing its position as a global economic leader.

India, with its young population and dynamic IT industry, is another important player within the BRICS. The Indian economy has grown significantly through reforms and increasing integration into the global economy. Initiatives such as Make in India and the Digital India campaign demonstrate India's ambition to become a central player on the global stage.

Brazil and South Africa also play essential roles within the BRICS group. Brazil is a leading exporter of agricultural products and has rich natural resources. South Africa, on the other hand, acts as the economic center of Africa and has significant natural resources that are important to the global economy.

Russia uses its vast energy resources to exert economic and political influence. As one of the world's largest producers of oil and gas, Russia has a strategic position, especially in energy relations with Europe and Asia.

The BRICS countries have refined their political strategies to better represent their interests on the global stage. Joint diplomatic initiatives and the building of alternative institutions to Western-dominated organizations show that these countries want to use their collective power.

The regular BRICS summits provide a platform for coordination and cooperation on political, economic and social issues. These meetings promote dialogue and unity among member states and help develop a common vision for the future.

With the establishment of the New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA), the BRICS countries have begun to create alternative financial structures to traditional Western institutions such as the International Monetary Fund (IMF) and the World Bank. These new institutions aim to promote economic development and ensure financial stability in member countries.

In addition to their economic and political power, the BRICS countries also have significant cultural and social influences. Through the export of culture and technology and exchanges in education and science, these countries contribute to globalization and shape the cultural landscapes worldwide.

Initiatives such as the China-Africa Cooperation Forum and the India-Africa Forum Summit promote cultural exchanges and cooperation in education and research. These programs help foster mutual understanding and respect between nations and build long-term relationships.

The BRICS countries invest heavily in research and development and promote innovation in areas such as information technology, biotechnology and renewable energy. Indian IT companies, Chinese tech giants and Russian space programs are examples of the leading roles these countries play in the global innovation landscape.

The increasing power of the BRICS countries has far-reaching implications for the global order. These nations are challenging the dominance of traditional Western powers and are working to create a multipolar world in which multiple centers of power exist.

The BRICS countries aspire to a multipolar world order in which power and influence are more evenly distributed. This vision contrasts with the unipolar dominance of the United States after the Cold War and the bipolar world during the Cold War. A multipolar world order could lead to more balanced and fair global governance.

The growing strength of the BRICS countries brings both challenges and opportunities. On the one hand, the shift in the balance of power could lead to tensions and conflicts as existing powers seek to defend their dominance. On the other hand, it offers new opportunities for cooperation and solving global problems through a diversified power structure.

In addition to their economic interests, the BRICS countries also pursue a number of political goals aimed at strengthening their global position and protecting their sovereignty and interests. These policy goals include both domestic and foreign policy dimensions and are closely linked to the group's economic aspirations.

A key policy goal of the BRICS countries is to strengthen their national sovereignty and independence from Western influences and institutions. These states strive to establish a multipolar world order in which they are not dependent on the dominant Western powers. This is evident, for example, in their criticism of the existing international financial institutions such as the International Monetary Fund (IMF) and the World Bank, which are seen as instruments of Western dominance.

The BRICS countries actively promote a multipolar world order based on the principle of equality and mutual respect. They argue that such an order is necessary to ensure a fairer distribution of power and resources. This goal is evident in their support for the reform of the United Nations, particularly the UN Security Council, to promote more representative and democratic global governance.

Another policy goal of the BRICS group is to promote regional stability and security. This is achieved through diplomatic initiatives and support for peace processes in various regions. For example, the BRICS countries are involved in Africa through various development and peace initiatives aimed at resolving conflicts and promoting economic development. In Asia, too, they play an important role in stabilizing and developing conflict areas.

Combating terrorism and extremism is a common concern among the BRICS countries. These countries are often targets of terrorist activities and see security cooperation as necessary to combat these threats. Through joint security agreements and the sharing of information and technology, they work to improve their capabilities to combat terrorism and extremism.

Although the BRICS countries have different political systems and views on human rights and democracy, they emphasize the importance of these principles in their international relations. They argue that the promotion of human rights and democracy should not be achieved through external pressure, but through dialogue and mutual respect. This stance often contrasts with Western approaches that favor sanctions and intervention.

The BRICS countries seek to expand their diplomatic networks and alliances to strengthen their global position. By developing bilateral and multilateral relations with other emerging economic powers and developing countries, they seek to create a counterweight to Western dominance. These diplomatic efforts also include support for regional organizations such as the African Union (AU), the Commonwealth of Independent States (CIS), and the South Asian Association for Regional Cooperation (SAARC).

Sustainable development is another key policy objective of the BRICS countries. They emphasize the need to balance economic growth with social and environmental goals. This is evident in their support for international agreements such as the Paris Climate Agreement and their own national initiatives to promote renewable energy, reduce poverty, and improve education and healthcare.

In addition to their economic interests, the BRICS countries also pursue a number of policy objectives aimed at strengthening their global position and promoting a multipolar world order. These policy objectives are diverse and range from strengthening national sovereignty and independence to promoting regional stability and security to combating terrorism and extremism. By expanding diplomatic networks and promoting sustainable development, the BRICS countries are working to create a fairer and more balanced global order in which their voices and interests are adequately represented.

The United States, as the traditionally dominant global power, has closely monitored the development and strengthening of the BRICS countries. The US has responded to these new geopolitical realities in different ways, which is evident at various levels from diplomatic efforts to economic measures to military strategies.

The US has increased its diplomatic efforts to consolidate its traditional alliances and forge new partnerships. This is evident in intensive cooperation with the European Union, NATO, and strategic partners in Asia, such as Japan, South Korea, and India. Particularly noteworthy is the so-called "Indo-Pacific Strategy," which aims to position the US as a central power in the Asia-Pacific region and limit China's influence.

Economically, the US has taken measures to increase its competitiveness and erect trade barriers against BRICS countries. The trade conflict between the US and China is a prominent example of how economic power is used to pursue geopolitical goals. Through tariffs and trade restrictions, the US seeks to limit Chinese exports and protect American companies.

In addition, the US is actively seeking new trade agreements that promote its economic interests while reducing its dependence on BRICS countries. The recently renewed NAFTA agreement, now known as USMCA (United States-Mexico-Canada Agreement), is an example of these efforts.

Militarily, the US has increased its presence in critical regions and developed new defense strategies to counter potential threats from BRICS countries. Particularly in Asia, the US has strengthened its military alliances and increased its troop presence in strategic areas such as the South China Sea. This serves both as a deterrent and to secure trade routes and geopolitical interests.

Modernizing the armed forces and developing new technologies, including cyber defense and space defense, are also essential components of the American strategy to maintain its military superiority.

However, the shift in the balance of power also carries the risk of military conflict, especially in areas of high geopolitical tension. There is an increased risk of military clashes in the South China Sea, where several countries, including China, have territorial claims. The US has made it clear that it will defend freedom of navigation in these waters, which could lead to confrontations with China.

But there is also the potential for conflict in Eastern Europe, where Russia has expanded its military presence. NATO has increased its forces in Eastern Europe in response to Russia's actions in Ukraine and other areas, increasing tensions in the region.

To avoid military conflict, the US is also relying on preventive diplomacy and dialogue. High-level meetings and talks between the US and BRICS countries, especially China and Russia, are crucial to avoid misunderstandings and find common solutions to global challenges.

Despite the rivalry and competition, there are also areas where the US and BRICS countries work together. Global challenges such as climate change, terrorism and combating pandemics require multilateral cooperation. This presents opportunities for dialogue and cooperation that can help reduce tensions and pursue common interests.

The US response to the growing power of the BRICS countries is complex and multifaceted, characterized by a mix of diplomatic, economic and military strategies. While the risk of military conflict remains, the US is also working to address common global challenges through diplomacy and cooperation. The future of international relations will depend largely on how successful these strategies are and how well they succeed in ensuring peaceful coexistence in an increasingly multipolar world order.

The exit from the Petrodollar and its impact on world trade

The petrodollar, a term that refers to the U.S. dollar used in international oil trading, has long played a central role in the global financial system. This practice became established in the 1970s when the U.S. and Saudi Arabia reached an agreement to trade oil in U.S. dollars. However, in recent years, several countries have taken steps to move away from the petrodollar. This has significant implications for world trade and the global financial system.

The move away from the petrodollar is due to several factors. First, many countries are looking for ways to reduce their dependence on the U.S. dollar and the geopolitical risks associated with it. The U.S. use of sanctions that limit access to U.S. dollar transactions has prompted countries such as Russia and Iran to seek alternatives.

Second, economic and political tensions between the U.S. and emerging powers such as China have led to moves to conduct trade in other currencies. China, as the world's largest oil importer, has started trading oil in yuan to strengthen its currency internationally and reduce dependence on the US dollar.

The exit from the petrodollar has far-reaching consequences for global trade. First of all, it leads to a diversification of trading currencies. Countries that use alternative currencies for oil trading encourage the use of their own currencies or other major currencies such as the euro, the yuan or even cryptocurrencies. This contributes to the emergence of a multipolar monetary system that weakens the dominance of the US dollar.

Such a system can change global trade dynamics by encouraging new trade relationships and partnerships. Countries that move away from the petrodollar could build closer economic ties with each other, leading to greater economic integration and cooperation.

The move away from the petrodollar could also lead to increased volatility in the global financial system. The US dollar has long served as a stable reserve currency, and its dominance has helped stabilize international trade. However, diversification of trading currencies could lead to short-term uncertainty as markets need to adapt to new trading and monetary practices.

However, in the long term, a multipolar monetary system could contribute to a more stable and balanced global economy. It could reduce the risk associated with dependence on a single currency and increase resilience to economic shocks.

The shift away from the petrodollar also has significant geopolitical implications. Countries that use alternative currencies for trade gain political and economic independence. This could lead to a shift in the geopolitical balance of power as the US's ability to exert its influence through financial sanctions is limited.

At the same time, new alliances and partnerships based on shared economic interests could emerge. The BRICS countries play a central role here as they are actively working to create an alternative financial system. By promoting trade in their own currencies and supporting initiatives such as the New Development Bank, they are helping to create a multipolar world order.

The shift to a diversified monetary system brings both challenges and opportunities. For many countries, adapting to new trading currencies presents logistical and economic challenges. The need to hold and manage foreign exchange reserves in multiple currencies could add additional costs and complexity.

On the other hand, diversifying trading currencies offers the opportunity to reduce economic dependence and achieve greater financial autonomy. This could be particularly beneficial for developing countries seeking to strengthen their economic sovereignty and improve their integration into the global economy.

The phase-out of the petrodollar and the associated changes in global trade have profound implications for the global financial system. The shift toward a multipolar monetary system could lead to a more balanced and resilient global economy, but it also brings short-term challenges and uncertainties. While the US adapts its strategies to respond to these changes, the BRICS countries and other emerging powers will continue to play a central role in shaping the new world order.

Reasons for oil-producing countries to join BRICS:

Diversification of economic partnerships: Oil-producing countries, particularly those in the Middle East such as Saudi Arabia and the United Arab Emirates, want to diversify their economic relationships to avoid being solely dependent on Western markets. BRICS membership gives them access to new markets and investment opportunities in the growing economies of BRICS members such as China and India.

Geopolitical strategies: The geopolitical landscape has changed dramatically in recent years. Countries such as Russia and China offer alternatives to traditional Western alliances. Oil-producing countries are looking for ways to strengthen their geopolitical position and reduce their dependence on Western states, especially in the face of political tensions and economic sanctions.

Economic and financial benefits: BRICS countries offer potential economic and financial benefits through joint development banks and investment funds. These entities can finance projects in infrastructure, technology and other key areas, which is particularly attractive to oil-producing countries seeking to diversify and modernize their economies.

Political independence and sovereignty: By joining a bloc like BRICS, oil-producing countries can strengthen their political independence and sovereignty. They can free themselves from Western political and economic pressure and form alternative alliances that better suit their national interests.

Common interests: Many BRICS and oil-producing countries share common interests in areas such as energy, infrastructure development and economic cooperation. These common interests can form the basis for closer cooperation and mutual support.

Growing markets in BRICS countries: BRICS countries represent some of the largest and fastest-growing economies in the world. Oil-producing countries see this as an opportunity to expand their export market and capitalize on the growing demand for energy in these countries.

Overall, oil-producing countries are looking for ways to expand their economic base, strengthen their geopolitical position and gain more independence in the international arena. Membership in BRICS offers an attractive way to achieve these goals.

The BRICS countries are therefore playing a crucial role in reshaping the global balance of power. Their growing economic, political and cultural strength has the potential to fundamentally change the world order. While these changes bring both challenges and opportunities, the future of the global order remains uncertain. However, it is clear that the BRICS countries will continue to play a significant role in the coming decades and significantly influence the global economy and politics.

The challenge of Dollar dominance

The global financial landscape is shaped by one dominant currency - the US dollar. Since the end of World War II, the dollar has maintained its position as the world's reserve currency and has had a significant impact on international trade, financial markets and geopolitical relations. But in recent years, more and more voices have been raised to discuss the challenges and risks of dollar dominance.

The dollar's rise to become the world's accepted reserve currency began after World War II with the introduction of the Bretton Woods system. In this system, most global currencies were pegged to the dollar, which in turn was pegged to gold. This link to gold gave the dollar stability and trust, making it the preferred currency for international transactions. But the Bretton Woods system collapsed in the 1970s when the US abandoned its gold peg and the dollar became a freely floating currency.

Despite the collapse of the Bretton Woods system, the dollar maintained its dominance as a reserve currency. This was partly due to the strong American economy and the strong political influence of the US in the world. In addition, many countries have chosen the dollar as an anchor currency to stabilize their own currency and instill confidence in their economy. This resulted in the majority of global foreign exchange reserves being held in dollars and the dollar dominating international trade.