Sergey Lavrov, the Russian Minister of Foreign Affairs, has stated that there is a growing understanding about increasing the use of national currencies in settlements between the member states of the Shanghai Cooperation Organisation (SCO). The statement was made following discussions with counterparts in Panaji, the capital of the Indian state of Goa. To achieve this goal, Lavrov believes that participants can apply practices that are being formed in the Eurasian Development Bank, the Asian Bank for Reconstruction and Development, and the New Development Bank established by the BRICS bloc.
Practical Measures Being Considered
Lavrov confirmed that this topic has been discussed at the SCO meeting, including the creation of “some kind of aggregated currency” which cannot be ruled out. He emphasized that the main focus now is to consider practical issues that will make it possible to protect the cooperation of independent states. The head of Russian diplomacy also reminded about the proposal put forward by President of Brazil, Luiz Inacio Lula da Silva, on the transition towards payments in national currencies in the BRICS group of emerging economies (Brazil, Russia, India, China, and South Africa).
Transition to National Currencies Supported by SCO and BRICS
Despite intentions to move away from the US dollar, the introduction of a common currency is not yet being considered by its members, the Russian diplomat noted. The SCO, which unites China, Russia, India, Pakistan, and several Central Asian nations, is preparing to ditch the dollar in favor of settlements in the national currencies of its members, according to Grigory Logvinov, its Deputy Secretary General. BRICS, which is considered to be the world’s largest bloc by gross domestic product (GDP), also intends to initially promote the use of its national currencies.
West Accused of Abusing Position in Global Economy
Lavrov accused the West of abusing its position in the global economy and the reserve currency status of the US dollar and the euro. He believes that the use of national currencies will help to protect the cooperation of independent states and stop the West from dominating the global economy. The work to transition towards payments in national currencies is already underway and cannot be stopped, Lavrov emphasized.