After missing last year’s BRICS Summit in South Africa due to an international arrest warrant issued against him, Russian President Vladimir Putin is set to make a notable comeback by hosting this year’s summit, starting Tuesday, in the Russian city of Kazan. While many see the summit as an opportunity for Putin to bolster his tarnished global image—damaged significantly by Russia’s invasion of Ukraine—his ambitions extend far beyond image management. According to the British publication The Economist, Putin plans to use the summit of the BRICS nations (Brazil, Russia, India, China, and South Africa) to push for a decisive blow against the US dollar’s hegemony in global finance.
For Putin, this gathering of what is now a ten-member bloc of emerging and developing economies presents a platform to challenge the dominance of Western financial systems, particularly those led by the G7 nations. Central to his vision for this year’s BRICS Summit is the development of an alternative global payment system, designed to provide countries like Russia, Iran, and other states targeted by Western sanctions with a mechanism to circumvent the economic pressure imposed by the US and its allies.
Putin’s strategy aligns with a growing sentiment among BRICS countries, which together account for nearly 40% of the global population and a substantial share of the world’s economic output. There is increasing frustration over what many in these nations perceive as the disproportionate power of Western countries in global finance, where the US dollar’s dominance places them at a strategic disadvantage.
Lavrov’s Warning and the Rationale Behind the Plan Ahead of the summit, Russian Foreign Minister Sergey Lavrov underscored the urgency of establishing a BRICS-exclusive payment system. “Everyone realizes that they could become the next target of sanctions by the US or other Western countries,” Lavrov noted, framing the initiative as not just a strategic move for Russia, but as a safeguard for all BRICS members and potentially other countries wary of falling under Western economic pressure. According to Lavrov, an independent BRICS payment system would enable global trade without relying on the US dollar or euro, currencies that he claims have been increasingly “weaponized” to serve geopolitical interests.
The payment system, which would operate outside of Western financial frameworks, could provide BRICS nations the ability to settle trade agreements and investments on their own terms, free from the scrutiny and leverage of US financial institutions. Such a development would mark a significant shift in the global economic landscape, posing a challenge to decades of American economic dominance.
Putin’s Long-Standing Goal: A New Global Currency This push for a BRICS payment system isn’t new for Putin. For years, the Russian leader has sought to establish an alternative to the US dollar in international trade, especially after the imposition of Western sanctions following Russia’s annexation of Crimea in 2014. One such effort includes the introduction of the digital ruble, a central bank digital currency (CBDC) that Putin has touted as a means to bypass the dollar. However, his efforts have met with limited success, and Russia remains largely dependent on the global financial infrastructure dominated by the US and Europe.
Putin’s broader objective of challenging the dollar’s supremacy reflects a wider frustration with what many non-Western countries perceive as the disproportionate influence that the US exerts over the global financial system. By championing a new system that excludes the dollar, Putin is not only seeking to shield Russia from sanctions but also to rally other countries disillusioned with Western dominance.
BRICS Bridge: The New Payment System Model The centerpiece of Putin’s plan is the creation of a payment system known as “BRICS Bridge.” According to The Economist, the system is designed to be operational within a year, enabling cross-border transactions between BRICS member states using digital platforms overseen by their respective central banks. This would allow for seamless trade and investment flows without the need to route transactions through US or European financial institutions, and crucially, without using the US dollar as an intermediary currency.
What makes this plan particularly striking is that it reportedly draws heavily on a project known as “mBridge,” developed by the Bank for International Settlements (BIS) in Basel, Switzerland. The BIS is largely dominated by Western powers, making the adoption of its model by BRICS somewhat ironic, given that its very purpose is to diminish the influence of the West.
The BRICS Bridge system, once implemented, could represent a major shift in the global financial landscape. By allowing for the settlement of international trade in local currencies or a BRICS currency, it would provide a viable alternative to the US-dominated SWIFT network, which currently handles the vast majority of cross-border transactions. This move would enable countries like Russia, China, and India to trade freely without the need for dollar reserves, weakening the global demand for the US dollar and, by extension, diminishing America’s global influence.
US Financial Dominance Under Threat Currently, US financial institutions play an indispensable role in the global payment system, and American banks are involved in a majority of international transactions. This dominance has been a cornerstone of the global economic order since the end of World War II, allowing the US to wield immense economic and political influence worldwide. The dollar’s status as the world’s primary reserve currency is backed by the country’s unparalleled military and economic power, as well as by the widespread trust in US Treasury bonds as safe, reliable, and highly liquid financial assets.
Because of its financial supremacy, the US has unprecedented access to global financial data and uses this position to enforce sanctions, monitor money laundering, and combat terrorist financing. It has also given Washington significant leverage over countries that depend on access to the global financial system. A successful challenge to the US dollar, spearheaded by the BRICS nations, could erode this critical aspect of American power and alter the balance of international economic relations.
A Potential Shift in Global Economic Power While many analysts remain skeptical about the feasibility of the BRICS Bridge system and other alternatives to the dollar, the plan represents a growing discontent with the current global financial order. Should the BRICS nations succeed in building an alternative payment system, it would likely encourage other countries, especially those affected by Western sanctions, to join in, further undermining the dominance of the US dollar.
Putin’s push for a BRICS payment system reflects not just a desire to insulate Russia from sanctions, but a broader geopolitical move aimed at reshaping the global financial system in a way that diminishes Western influence and empowers emerging economies. As the world watches the developments in Kazan, the potential implications for global trade, finance, and diplomacy could be profound.
