2023-08-15 13:46:00
Baron Jim O’Neill, the former Goldman Sachs investment bank economist who coined the term “BRICS” more than two decades ago, has ridiculed the idea of creating a common currency of the 5 emerging economies, reports Markets Insider.
Baron Jim O’NeillFoto: James Manning / PA Images / Profimedia
O’Neill, who first used the term BRICS in a research paper in 2001, says such an idea floated to avoid using the dollar in trade is “simply ridiculous”.
“Will they create a BRICS central bank? How would that work? It’s almost embarrassing,” he said in an interview with journalists from The Financial Times a week before the next BRICS summit, the informal organization that includes Brazil, Russia, India, China and South Africa.
This year’s summit attracted attention after the International Criminal Court in March issued an arrest warrant in the name of Russian President Vladimir Putin, South Africa being forced to detain the leader from the Kremlin if he steps on its territory, being a member country of the institution.
After months of speculation about this, the Kremlin officially announced on July 19 that Putin will not go to the BRICS summit that this year is hosted by the South African city of Johannesburg, Russia will be represented instead by its foreign minister, Sergey Lavrov. But Putin will also intervene via video conference.
Talks of a BRICS currency at the South African summit?
At this year’s summit, the requests of several countries to be accepted into the organization will be discussed, with some sources saying that the possibility of adopting a common currency will also be debated behind closed doors. South Africa, as the host country, dismissed these speculations.
The idea was publicly supported, however, by Brazilian President Luiz Inacio Lula da Silva.
“Why can’t we trade backed by our currency? Who decided it was the dollar? We must have a currency that transforms countries into a somewhat calmer situation, because today a country has to run after the dollar to export,” he said in April at the inauguration ceremony of Brazilian economist and former politician Dilma Rousseff at the New Development Bank, formerly the “BRICS Bank”.
This is a lending institution founded by BRICS member states to play a role similar to that of the International Monetary Fund.
Lula added, among other things, that “it’s hard, because they’re bad people,” but it’s also necessary not to rush change, and called for China’s “patience.”
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