Russian President Vladimir Putin has openly criticized the U.S. dollar-based global financial system, stating that it is gradually collapsing. Speaking at the 20th-anniversary meeting of the Valdai Discussion Club, Putin emphasized the decline of the U.S. economy’s influence on the world stage, directly impacting the stability of the U.S. dollar.
“The Bretton Woods system, built on the U.S. dollar, is becoming outdated,” Putin remarked, stressing that this view is also shared by Western experts. He further explained that a currency’s strength is a reflection of the issuing country’s economic power, and with the American economy’s share in global GDP diminishing, the dollar’s role in international finance is weakening.
The Rise of BRICS in Global Finance
In contrast, Putin pointed to the growing influence of BRICS nations, particularly in terms of purchasing power parity. He noted that this trend has become more pronounced with the recent expansion of BRICS, which now includes Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE. The Russian president suggested that the bloc is increasingly moving towards using local currencies for international trade, further challenging the dominance of the U.S. dollar.
At the recent BRICS summit in August, leaders of the five founding nations—Brazil, Russia, India, China, and South Africa—underlined the importance of promoting local currencies in global financial transactions.
Will BRICS Create a Common Currency?
Addressing the idea of a common BRICS currency, Putin acknowledged that while it’s a theoretical possibility, it is not an immediate priority. He explained that the bloc first needs to establish a robust financial settlement system and logistics to support payments in national currencies. Although the concept of a single BRICS currency has been discussed, Putin noted that it would require significant economic parity among member states, making it a long-term goal.
