In addition, the BRICS are working on creating an alternative financial and payment infrastructure and establishing their own reinsurance company
In October 2024, Russian Finance Minister Anton Siluanov announced the start of work on the creation of the BRICS Clear depository system for the BRICS countries.
The new system is designed to ensure the accounting of securities within the BRICS community and become an alternative to Western counterparts, access to which is limited for Russia and some other countries.
From left: Brazil's President Luiz Inacio Lula da Silva, China's President Xi Jinping, South African President Cyril Ramaphosa, Indian Prime Minister Narendra Modi and Russia's Foreign Minister Sergei Lavrov raise their arms as they pose for a group photograph, at the BRICS Summit in Johannesburg on August 23, 2023. (Photo by ALET PRETORIUS / POOL / AFP) (Photo by ALET PRETORIUS/POOL/AFP via Getty Images)
Siluanov in an interview with RT Arabic noted that BRICS Clear will be based on distributed registry technology. This decision was made in the context of the restrictions that Russia faced when working with Western securities accounting systems.
"Suppose Egypt makes proposals to improve the work of international development banks. Ethiopia has offered its ideas regarding the use of resolution mechanisms. We know that Iran also has extensive experience in using its financial technologies to facilitate international trade. The United Arab Emirates has made proposals for the development of artificial intelligence in finance."
In addition to the depository system, the BRICS countries are working on the creation of an alternative financial and settlement payment infrastructure. According to the minister, it will be formed on the basis of new technologies using digital financial assets. This will allow settlements for trade outside Western infrastructure, providing faster and cheaper payments.
"Now we are not considering the creation of any single currency. We are specifically talking about the creation of an alternative financial and payment system that would use the national currencies, DFAs and digital currencies of our association countries."
The third area of cooperation between the BRICS countries in the financial sector is the creation of its own reinsurance company. Siluanov stressed the need to provide trade insurance services within the BRICS, regardless of political restrictions.
Initiatives to create new financial instruments within the BRICS arose against the background of difficulties with cross-border payments that Russia faced after the introduction of Western sanctions in 2022. In March 2024, Russian President Vladimir Putin signed a law allowing the use of digital assets for cross-border payments.
"Therefore, our task (ministries of finance and central banks) is to create our own independent system in the context of the fragmentation of the world economy and the adoption of such decisions-mostly political ones-by the West. It must be based on modern technology, be better, of higher quality and, as a result, work to meet the needs of our economic actors and economies as a whole. We see that a significant number of countries are interested in the operation of such a project."
It is expected that the details of the project to create a BRICS settlement and payment infrastructure will be presented at the summit of the unification countries, which will be held at the end of October in Kazan. This platform is designed to make payments in national currencies and cross-border transactions in digital currencies
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