Russian President Vladimir Putin has revealed the gradual decline of the U.S. dollar-based global financial system. Speaking at the 20th-anniversary meeting of the Valdai Discussion Club, Putin emphasized that the Bretton Woods system, which has long been the backbone of global finance, is becoming increasingly obsolete. Moreover, he pointed out that the share of the American economy in world GDP is dwindling.
BRICS economies gain momentum
In contrast to the waning influence of the U.S., Putin highlighted the growing economic power of the BRICS nations. These countries, which include Brazil, Russia, India, China, and South Africa, have seen their share in terms of purchasing power parity rise significantly. Additionally, the BRICS economic bloc recently welcomed new members such as Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates. Consequently, the leaders of these nations have emphasized the importance of using local currencies in international trade and financial transactions.
Putin elaborated on the future prospects of the BRICS nations, stating that while a single currency for the bloc is theoretically possible, the immediate focus should be on establishing a robust settlement system. This system would facilitate payments between member states and encourage transactions in national currencies. Hence, Putin believes that achieving economic parity among the BRICS nations is a long-term goal, but one that is crucial for the stability and growth of the bloc.
The Russian President’s comments come at a time when the global financial economy is undergoing significant changes. Significantly, Western experts also share Putin’s view that the Bretton Woods system is outdated.
Putin’s remarks have added a new dimension to the ongoing debate about the future of global finance as nations worldwide, particularly those in the BRICS bloc, are actively exploring alternatives to ensure financial stability and growth.
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