BRICS Summit in Russia’s Kazan

The 2024 BRICS Summit will take place in Kazan, Russia, starting on October 22, and will last for three days. Kremlin spokesman Dmitry Peskov described it as “one of the main events on the global agenda.” Attendees are set to talk about establishing a BRICS digital payment system called BRICS Bridge and ways to boost trade using national currencies. Russian presidential aide Yury Ushakov indicated that the summit could become Russia’s biggest foreign policy event ever. One of the key topics will be setting clear criteria for admitting new BRICS members and working with partner countries in different ways.
Ushakov emphasized that Moscow is aiming for a smooth process for new countries to join the group’s existing cooperation framework. In addition to Russia, Brazil, India, China, and South Africa, BRICS, formed in 2006, now also includes new members like Egypt, Ethiopia, Iran, and the United Arab Emirates. Since January 1, 2024, Russia has held the group’s rotating presidency, focusing on enhancing BRICS’s role in the global monetary and financial system, improving interbank cooperation, and increasing the use of national currencies in trade.
What to expect from BRICS2024 Summit in Kazan, Russia
The summit will be the first to include the new members: Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates, increasing the total membership to 10. More than 32 countries have confirmed they will attend, including 24 leaders. All BRICS countries are taking part, with nine represented by their heads of state and Saudi Arabia sending its foreign minister. The summit will happen in two parts. The first part, from October 22-23, will focus on BRICS members and will revolve around the theme “Strengthening Multilateralism for Just Global Development and Security.” The second part, from October 23-24, will adopt a “BRICS Plus/Outreach” format, focusing on “BRICS and the Global South: Jointly Building a Better World.”
Participants will also talk about new members, as 34 countries have shown interest in joining BRICS or partnering with it. Russian President Vladimir Putin plans to hold over 20 meetings with leaders, including Chinese President Xi Jinping, Indian Prime Minister Narendra Modi, and Turkish President Recep Tayyip Erdoğan. A joint statement from the countries involved is expected at the end of the summit on Thursday. Alexander Dugin and Pepe Escobar joined Dimitri Simes Jr of the New Rules Podcast to discuss BRICS.
BRICS to Discuss New Global Financial System – The Dollar’s Final Days?
Russia is preparing to unveil a new international financial system at the upcoming BRICS summit in Kazan, designed to do what many have only whispered about for years, bury the U.S. dollar’s supremacy. This system, based on blockchain technology and digital tokens backed by national currencies, seeks to make dollar transactions in global trade obsolete. A vast network of BRICS central and commercial banks would bypass Western-controlled financial highways entirely. But there’s more. Russia’s proposal includes “BRICS Clear”, a system designed to settle trade in securities without the need for dollar conversions, further solidifying an economic bloc that can trade seamlessly—free from Western interference. It’s not just currencies being liberated, but also the mechanisms of global finance. Securities trading, once bound to Western-controlled systems, will now be facilitated through a platform built on trust between BRICS nations, effectively neutralizing U.S. financial dominance.
BRICS chipping away at dollar dominance
The dollar has long been the king of global finance, but now its grip is starting to slip, and Russia’s new proposal could be the final blow. The surprising twist is that the U.S. and its allies, who have been so good at using the dollar as a weapon, now find themselves backed into a corner. Washington often talks about “freedom,” but when it comes to money around the world, it’s really about using pressure and making sure the dollar keeps its top spot. With 95% of trade between Russia and China already being done in rubles and yuan, it raises the question: who even needs the dollar anymore? Here’s where it gets interesting. While organizations like the IMF and World Bank are busy rearranging things and coming up with new sanctions to try to hold onto power, Russia is rolling out a blockchain-driven platform that could make these old systems seem outdated. It’s like throwing out a typewriter when everyone else is using laptops. The best part? This new financial setup doesn’t rely on U.S. banks, U.S. infrastructure, or even U.S. permission.
The West seems to be lost in a fantasy, thinking that their sanctions can really hurt economies. But Russia’s new system doesn’t seem to care about those sanctions at all. It’s almost as if it’s saying, “Sanctions? What sanctions?” As BRICS Clear comes into play, it’s not just about freeing up currencies. This new platform also changes how securities are traded, cutting out Western middlemen and shrinking the U.S.’s role in the movement of money around the world. This isn’t just a minor tweak; it’s a major overhaul. Washington’s influence is nowhere to be found in this new financial structure. We’re starting to see a world where there are many ways to handle money, and the power of the empire’s dollars just won’t matter as much anymore.
But BRICS is not the only thing happening now. Interestingly, the 2024 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) opened yesterday, October 21 to focus on skyrocketing global public debt, which is expected to reach $100 trillion by the end of this year. The debt, in large part, is driven by the borrowing binge of the US, where the government debt currently stands at $35.68 trillion. Meanwhile, the US’ share of the global economy calculated using purchasing power parity has reached a historic low, plunging below 15%. It is expected to sag further, to reach 14.76% by the end of President Joe Biden’s term.
What happened to US finances and the global dollar system?
The US is estimated to have accounted for 48-52% of global GDP and about 60% of global industrial production in 1944.  America secured its economic superpower status at the end of WWII, when the international monetary system known as the Bretton Woods system was forged in July 1944. The Bretton Woods Conference officially crowned the US dollar as the global reserve currency, backed by the world’s largest gold reserves. Other currencies were pegged to the US dollar’s value.  International rules for foreign trade were laid out in the General Agreement on Tariffs and Trade (GATT) in 1947. In 1995, the agreement was transformed into the WTO. The US wielded these “tools” to secure geopolitical influence across Europe and Japan. Eastern Europe, the USSR, and China remained outside the zone of American expansion. Under the Marshall Plan, the US provided money, chiefly in the form of grants, to rebuild war-ravaged European economies.
At the same time, it funneled lucrative orders to American companies, stimulating its own economy while solidifying its influence over Western Europe’s economic systems. US gross national product rose from about $200 billion in 1940 to more than $500 billion in 1960. The US had exhausted its wave of growth by the end of the 1960s, after it got mired in the Vietnam War in an effort to scoop up another lucrative market. The US economy was scathed by its Vietnam debacle, as war spending by the end of the 1960s had led to rampant inflation and a swelling trade deficit. In 1971, the gold standard was officially abandoned by the US, with countries forced to use the most common fiat currency system, not backed by any physical commodity. The 1973 Arab-Israeli War ultimately led to an oil boycott by members of the Organization of Petroleum Exporting Countries (OPEC) that pushed energy prices upward. Inflation soared, federal budget deficits grew, and the stock market sagged. The US entered a period of “stagflation” (inflation and stagnant business activity).
The government resorted to greater borrowing, which in turn pushed up interest rates and increased costs. The economic policy of then-President Ronald Reagan – Reaganomics – was implemented in the 1980s to revitalize the crisis-mired economy with reduced government spending, slashed taxes, less regulation, and a slowdown of money supply growth to control inflation. In effect, reliance on unlimited and unrecoverable loans ignited a period of economic growth that lasted until the early 1990s. Under Reagan, the massive federal budget deficit increased from $834 billion in 1980 to $1.5 trillion in 1986. During the Great Recession in 2007-2009, when the US housing bubble burst and large amounts of mortgage-backed securities (MBS) and derivatives plummeted in value, domestic product declined 4.3%.
The first alarm bell for the global dollar system rang in 2014, when the West imposed sanctions against Russia after Crimea rejoined the country following a referendum. While Russia displayed resilience, global GDP fell by $4.23 trillion (5.35%) – more than during the 2008 crisis. Quarantines and supply chain disruptions in the COVID-19 pandemic year of 2020 cost the global economy another $3.7 trillion (4.2% of global GDP).  The global trend to abandon the increasingly weaponized US dollar has been gaining steam amid sanctions targeting Russia, Iran, North Korea, China, and companies in other countries cooperating with Russia. The trend is led by members of BRICS, with the group developing a new currency transaction platform to advance the digitalization trend and transition to other currencies in mutual settlements.
BRICS countries control over 20% of world’s gold reserves
BRICS countries hold a significant portion of the world’s gold reserves, controlling over 20% of the total. Among these nations, Russia stands out as the leader with an impressive 2,340 tons of gold. This amount makes up 8.1% of all gold reserves found across the globe. Right behind Russia is China, holding 2,260 tons of gold, which adds a substantial amount to the combined gold holdings of the BRICS group. When looking at the total gold reserves owned by all BRICS nations, Russia and China together make up a staggering 74%. As of the second quarter of 2024, global gold reserves totalled 29,030 tons, with BRICS (excluding Iran and Ethiopia) holding 6,200 tons, or 21.4 percent of the world’s total. Other BRICS members—India, Saudi Arabia, Brazil, Egypt, South Africa, and the UAE—hold smaller shares, collectively less than 3 percent of global reserves. India has 840.76 tons, Saudi Arabia 323 tons, Brazil 129.7 tons, Egypt 126.57 tons, South Africa 125.44 tons and the UAE 74.5 tons.  In addition to their gold reserves, the BRICS countries have also seen growth in their economic influence. Since the group was formed, their share of the world’s economy has increased by nearly 10%. In contrast, the G7 countries, which are traditionally seen as economic powerhouses, have experienced a decline in their share of the global economy by a similar rate. Specifically, when BRICS was established in 2006, its members represented 27.15% of the world economy, according to data from the World Bank. Fast forward to 2023, and that percentage has risen to 36.8%. Meanwhile, the G7’s share has dropped from 36.7% in 2006 to just 29% in 2023, highlighting a shift in economic power dynamics on the global stage.
Written By Tatenda Belle Panashe