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Introduction
On October 22, 2024, heads of state from some of the world’s most populous and resource-rich nations gathered in the Russian city of Kazan for a summit that received little attention in most Western newsrooms. The meeting was organised by BRICS, a coalition whose name began as an acronym coined in 2001 by Jim O’Neill, an economist at Goldman Sachs, to describe the next generation of fast-growing economies. Brazil, Russia, India, and China were the original four. South Africa joined in 2011, and by the time the Kazan summit concluded, four more countries had been welcomed into the fold: Iran, the United Arab Emirates, Ethiopia, and Egypt. The document that emerged from the meeting was thirty-two pages long and covered everything from development finance to climate commitments. But buried within the Kazan Declaration was a line that cut through all the diplomatic language. BRICS had collectively announced its intention to loosen the US dollar’s grip on global commerce, and the leaders present wanted the world to know they were serious about it.
Why One Country’s Currency Became the World’s
The US dollar did not become the world’s dominant currency through the force of markets alone. It was the product of a deliberate agreement. In July 1944, with the Second World War nearing its end, delegates from forty-four nations gathered at a resort in Bretton Woods, New Hampshire, to design a new global financial order from scratch. The resulting system had a straightforward logic: the dollar would be fixed to gold at thirty-five dollars per ounce, and every other major currency would in turn be pegged to the dollar. Gold was the anchor, the dollar was the rope, and every other currency hung from that rope. The United States, sitting on the world’s largest gold reserves at the time and emerging from the war as its dominant industrial power, was the natural choice to occupy this position.
When Richard Nixon severed the dollar’s link to gold entirely in 1971, it was far from obvious that the dollar would retain its special status. But a new arrangement emerged in the years that followed. The United States struck a deal with Saudi Arabia in which oil would be priced and sold in dollars, and in exchange Saudi Arabia would receive American military protection and a reliable market for its exports. Because oil powers almost everything in a modern economy, and because oil was now priced in dollars, every country that needed oil also needed dollars. If you wanted to buy crude from the Middle East, you needed dollars first. If you needed dollars, you had to either sell goods into American markets or borrow from dollar-denominated financial institutions. The entire architecture of global trade was quietly rebuilt around a single currency without any formal vote from the rest of the world. Economists call this arrangement the petrodollar system, and it is the foundation on which the dollar’s dominance has rested ever since.
The Weapon That Taught the World a Lesson
For most of the past eighty years, the dollar’s dominance looked like a fact of life rather than a policy choice. But February 2022 changed how many governments thought about it. When Russia invaded Ukraine, the United States and its European allies froze hundreds of billions of dollars worth of Russian central bank assets held in Western financial institutions and disconnected major Russian banks from SWIFT, the messaging network that allows banks across the world to coordinate cross-border money transfers. SWIFT is not a bank and it holds no money of its own. It is essentially a secure communication system, a way for banks in different countries to send instructions to each other reliably. But access to SWIFT is so fundamental to modern international trade that being cut off from it is, in practice, equivalent to being cut off from the global economy. Russian companies suddenly found themselves unable to receive payments from foreign buyers, unable to pay international suppliers, and unable to access a substantial portion of their own country’s savings held abroad.
The lesson that the Kazan Declaration’s signatories drew from Russia’s experience was not primarily about the justice or injustice of the sanctions themselves. It was about vulnerability. Any nation whose reserves, trade settlements, and payment infrastructure are denominated in dollars and routed through American-aligned systems is exposed to this kind of economic pressure if its foreign policy ever runs sharply against Washington’s preferences. The countries that gathered in Kazan represent a wide range of governments with different values and different relationships with the United States, but most of them arrived at the meeting having quietly concluded the same thing: the dollar’s dominance is not neutral, and depending entirely on it is a risk that deserves to be managed.
BRICS’ Blueprint to Break Free
The Kazan Declaration laid out a set of ambitions rather than a single finished plan, but the direction was clear across several fronts. The first and most immediate step involves trade in local currencies. A growing number of bilateral deals between BRICS members now settle payments in rupees, yuan, or roubles rather than dollars, reducing the need to hold large dollar reserves as a precondition for commerce. India has been experimenting with rupee-denominated oil purchases from Russia since 2022, and the New Development Bank, which BRICS established in 2015 as an alternative to the IMF and the World Bank, has announced that it intends to conduct roughly thirty percent of its future lending in currencies other than the dollar. The distinction the NDB’s founders have always emphasised is that it will lend to developing nations without the conditions that Western-led institutions typically attach to their loans, such as cutting public spending, privatising state assets, or liberalising specific markets.
The more ambitious piece of the blueprint is a proposed BRICS payment messaging system, which would allow the bloc’s members to transfer money across borders without routing transactions through infrastructure that Washington can control or shut off. No such system has been built yet, but the intention to create one has been formally stated in the Kazan Declaration. Alongside this, many BRICS central banks have been significantly increasing their gold reserves over the past decade, reducing the share of US Treasuries in their portfolios and replacing them with an asset that no single government can freeze or confiscate. The discussion at Kazan even touched on the idea of a new BRICS currency backed partially by gold, though this remains a distant and contested proposal with no agreed timeline.
Why the Dollar Will Not Give Up Its Throne Easily
The dollar’s grip on global finance runs far deeper than any single institution or agreement, and the history of de-dollarization efforts is a long one. Roughly sixty percent of all foreign exchange reserves held by central banks worldwide are still in dollars, and approximately half of all global trade invoices are still denominated in them. These numbers have edged down slowly over the past two decades, but they have not fallen sharply, and there is a straightforward reason for that. Trust in a currency comes from confidence in the institution behind it, which means confidence in its legal system, the depth of its financial markets, and the predictability of its government’s behaviour over long periods of time. The United States Treasury bond market is, by a significant margin, the most liquid and reliable store of value available to large investors anywhere in the world. Building a competing system with comparable credibility takes decades, not summits.
BRICS also faces its own internal tensions that make deep coordination difficult. India and China are the two largest economies within the bloc, and any BRICS currency or payment system would need the genuine commitment of both to carry real weight in global markets. But the two countries share a contested border where soldiers have clashed in recent years, and they have competing strategic interests across much of Asia and the Indian Ocean region. India is also deeply engaged with the United States through security frameworks like the Quad and through trade ties that would be difficult to disentangle quickly. This is not unique to India. Most BRICS members have economic relationships with the United States and Europe that make a sharp break impractical, and the dollar system, whatever its frustrations, is one they understand and know how to navigate. De-dollarization, as a serious project, asks countries to accept uncertainty now in exchange for sovereignty later, and most governments move slowly in that direction.
Final Thoughts
The Kazan Declaration is real, and the discomfort that BRICS nations feel about the dollar’s dominance is genuine. When John Connally told European finance ministers in 1971 that the dollar was America’s currency but their problem, he was describing a structural reality that has not fundamentally changed in the fifty-three years since. The countries that gathered in Kazan in October 2024 are not yet powerful enough to displace the dollar in a single move, and most of them know it. What they are doing is something slower and more methodical: building alternative institutions, establishing local currency trade routes, stockpiling gold, and laying the groundwork for payment infrastructure that does not depend on Washington’s approval. Whether these efforts eventually produce a genuine rival to the dollar, or whether they simply give BRICS nations a little more leverage when dealing with the West, is a question that will take years to answer. What the Kazan summit made clear is that the question is now being asked seriously, and by a group of nations that together account for forty percent of the world’s population and roughly thirty-five percent of its economic output.