According to Brazilian President Luiz Inacio Lula da Silva, developing countries should abandon the US dollar in favor of their own currencies to challenge American hegemony over the world financial system.
On Thursday, while on an official visit to China, Lula suggested in Shanghai that the BRICS nations—Brazil, Russia, India, China, and South Africa—should explore for a trading currency other than the dollar.
“I ponder why all nations are required to base their trade on the dollar every night. Why can’t we conduct business using our own money, he questioned. Who made the decision that the dollar will replace the gold standard as the dominant currency?
After lamenting that “everyone depends on just one currency,” the leftist leader suggested “a currency to finance trade relations between Brazil and China, between Brazil and other countries.” The leftist leader was alluding to the dollar.
The former Brazilian president Dilma Rousseff was appointed to lead the New Development Bank, also known as the “BRICS bank,” on the first day of Lula’s visit to China. Lula claimed that this appointment could free emerging economies “from submission to traditional financial institutions, which want to govern us.”
Along with the president, the finance minister of Brazil, Fernando Haddad, visited China. While there, he made a statement to the media in which he stated that Brazil would work to develop trade systems that would allow developing nations to avoid using the dollar.
The benefit, according to him, is avoiding the constraint caused by having trade operations paid in a currency of a nation not involved in the transaction.
