Leaders of the Expanded BRICS nations at the 16th BRICS Summit in Kazan, Russia, yesterday. Picture: Supplied.
Leaders from the expanded BRICS nations have set an ambitious agenda to enhance intra-BRICS trade by furthering the use of local currencies in financial transactions.
Through the Kazan Declaration signed yesterday at the 16th BRICS Summit in Russia, they have mandated finance ministers and central bank governors from member countries to explore various options aimed at easing economic exchanges within the bloc.
This comes as BRICS nations have embarked on strengthening correspondent banking networks within BRICS and enabling settlements in local currencies in line with BRICS Cross-Border Payments Initiative (BCBPI), which is voluntary and non-binding including in the BRICS Payment Task Force.
In the Kazan Declaration, the leaders acknowledged the importance of exploring the feasibility of connecting BRICS countries’ financial markets infrastructure.
The leaders highlighted the importance of exploring the feasibility of connecting BRICS countries’ financial markets infrastructure, and agreed to discuss and study the feasibility of establishment of an independent cross-border settlement and depositary infrastructure, BRICS Clear.
“We agree to discuss and study the feasibility of establishment of an independent cross-border settlement and depositary infrastructure, BRICS Clear, an initiative to complement the existing financial market infrastructure, as well as BRICS independent reinsurance capacity, including BRICS (Re)Insurance Company, with participation on a voluntary basis,” read the declaration.
“We underscore the need to reform the current international financial architecture to meet the global financial challenges including global economic governance to make the international financial architecture more inclusive and just.
“We recognise the crucial role of BRICS in the process of improving the international monetary and financial system (IMFS), with a view to making it more responsive to the needs of all countries.
“We recognise the widespread benefits of faster, low cost, more efficient, transparent, safe and inclusive cross-border payment instruments built upon the principle of minimizing trade barriers and non-discriminatory access. We welcome the use of local currencies in financial transactions between BRICS countries and their trading partners.”
In his speech during a plenary meeting of BRICS leaders, President Cyril Ramaphosa said South Africa saw the 16th BRICS Summit as an opportunity to harness collective strength to build a safer, more prosperous and equitable world.
“It is in this spirit that South Africa will assume the Presidency of the G20 next year under the theme of: “Solidarity, Equality and Sustainable Development.”
“We will seek to mobilise the countries of the world to take practical steps to resolve global challenges while strengthening international cooperation within a rules-based system. In an interconnected world, the challenges faced by one nation affect all nations.”
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