Thoughts on the BRICS summit at Kazan

Will the Sino-Russian partnership introduce gold backing for a trade settlement currency, replacing the dollar? And what would be the consequences for the dollar?

The annual BRICS summit in Kazan is rapidly approaching. Among the issues likely to be on the agenda are a proposal to create a new class of associate membership to manage the rapid expansion of BRICS with some forty nations now seeking to join. Furthermore, there is the thorny question of how to do away with the dollar for cross-border trade settlement, over which there has been disagreement among existing members.

Introduction

The BRICS summit in Kazan comes at a very tricky time. Russia may be winning its special operation in Eastern Ukraine, and so NATO led by the US either goes for broke with an all-out war against Russia or seek a face-saving de-escalation. The likelihood is de-escalation and to seek another conflict.

At only a year old the Middle East conflict is just starting, and not only is the US backing Israel but Russia is backing Iran. It is turning rapidly into another proxy war, potentially far more serious than Ukraine. This is because Israel has triggered a fight which without US support will lead not only to its likely defeat but the end of its existence as a nation.

We can be sure that the Americans will be increasingly wanting to call the shots, as much if not more than the Israelis particularly with respect to Iran. They don’t do anything abroad without taking control. Equally, the restraint initially shown by Iran can be partly explained by Russia’s influence. And while Iran appears to be more independent from its backer than Israel, it is still a US objective to defeat Russia. This is the turbulent background to the BRICS summit in Kazan later this month.