Brazil's President Luiz Inacio Lula da Silva gestures during a meeting with auto industry leaders to announce measures to boost car purchases by low-income Brazilians, at the Planalto Palace in Brasilia, Brazil, May 25, 2023. REUTERS/Ueslei Marcelino
Brazil, under the leadership of President Luiz Inácio Lula da Silva, is actively challenging the dominance of the US dollar in international trade. President Lula has been a vocal proponent of de-dollarization, advocating for an alternative global currency to free countries from what he calls Washington’s “currency stranglehold.” This move is seen as a strategic response to perceived unequal trade terms and US interventionism, with many Brazilians viewing Washington’s pressure as a threat to national sovereignty. The recent BRICS summit saw a push for the creation of an alternative payment system to SWIFT, further highlighting the bloc’s commitment to this goal.
The shift away from the dollar is backed by strong economic data. While Brazil’s trade with the US is around $92 billion, its commerce with BRICS partners is significantly larger, reaching nearly $210 billion. China, in particular, has been a key partner, signing cooperation deals with Brazil across various sectors. This stronger reliance on BRICS allies provides Brazil with a buffer against US influence and a reduced need to depend on the US currency for global transactions. The rise of new financial tools, such as Brazil’s free payment system, PIX, also signals a move towards greater financial autonomy.
The broader movement for de-dollarization is a shared priority among BRICS nations, who are seeking to mitigate the risks associated with currency volatility and protect themselves from unilateral sanctions. The creation of institutions like the New Development Bank (BRICS Bank) aims to build a new financial ecosystem and provide an alternative to Western-led financial institutions. This collective effort points to a long-term strategy to reshape the global financial system and foster a more balanced and multipolar international order.
Sources:
De-dollarization: BRICS leaders propose creating an alternative payment system to SWIFT
US gov’t is very afraid of BRICS and dedollarization, Trump insiders reveal. That’s why he’s attacking Brazil
Understanding De-dollarization Among BRICS Nations: Systematic Review of the Factors and Fallout – SciELO
