Egypt took action to de-dollarize

Egypt’s “Sadi al-Balad” news site wrote that the country’s government has officially distanced itself from the US dollar for commercial transactions and has joined the growing coalition of countries that seek to reduce dependence on the dollar.

Egypt’s decision to get rid of the dollar was made following the country’s acceptance into the “BRICS” group, which took place at the 2023 summit.

According to the report of “Sadi al-Balad”, it is expected that Egypt, along with the Islamic Republic of Iran, Saudi Arabia, the United Arab Emirates and Ethiopia, will try to strengthen BRICS.

According to Sedi al-Balad, the Ministry of Foreign Affairs of Egypt emphasized its adherence to the use of national currencies in commercial transactions, pointing out that it wants to reduce the financial pressures caused by the use of dollars in the settlement of commercial accounts.

>

According to the report of Watcher Guru website, this decision shows the growing trend among BRICS member countries, who are increasingly concerned about the world’s economic developments and geopolitical tensions and Western sanctions.

Also, considering that the American economy has faced increasing challenges and debts, the emerging economies in the BRICS group are looking to change to trading with national currencies.

While the BRICS countries follow the complexities of international trade and geopolitical dynamics, Egypt’s move away from the US dollar underscores the group’s commitment to promoting a more diverse and flexible global financial system.

The idea of ​​creating the BRICS group was formed with the convergence of four emerging economic powers of the world, including Brazil, Russia, China and India, during the height of American unilateralism in the mid-1990s. The history of the formation of this group goes back to 2001 with the presence of 4 founding members, and finally, “Break Group” was officially established on June 16, 2009. South Africa was also added to this group on September 21, 2010, and its name was changed from “BRIC” to “BRICS” after joining this country.

The most important indicator in this group is the economic, financial and monetary functions, as well as the trans-regional and global scope of its members and its influence, and therefore it is known as the group of “emerging economic powers”.

Currently, in addition to the 5 main members, 23 countries officially and 6 countries unofficially want to join this group, including Iran, Indonesia, Saudi Arabia, Kuwait, the United Arab Emirates, Bahrain, and Egypt. , Syria, Morocco, Belarus, Kazakhstan, Cuba, Bolivia, Nigeria, Argentina, Venezuela, Thailand, Vietnam, Algeria, Palestine, Ethiopia, Honduras, Mexico and… he mentioned that they are referred to as “BRICS Plus”. /p>

The proposal to create BRICS+ was first proposed at the summit of this group in China in 2022 by the president of this country to be a mechanism to bring countries closer to this group before granting full membership.

BRICS is a symbol of “regime building and new structuring in the international scene” which was formed by the emerging powers and confronting the unipolar and bipolar world.

An important weapon BRICS currently has up its sleeve is the “de-dollarization” initiative. This economic bloc initially aims to strengthen trade agreements and help it grow over the next few years. After succeeding at this stage, BRICS can proceed to de-dollarization and begin to settle trade in local currencies.

The overall idea of ​​BRICS is to eventually break ties with the US dollar and boost local currencies. Increased trade among BRICS members increases the threat to the dominance of the US dollar. China and Russia, which are BRICS members, are aggressive in their efforts to de-dollarize and are taking steps towards its realization.

BRICS accepted five oil-producing countries as members at the 15th summit in Johannesburg in August this year. Oil exporting countries that will join BRICS in 2024 include Saudi Arabia, United Arab Emirates, Egypt, Iran and Ethiopia. If BRICS uses local currencies to buy oil, the US dollar will be hit the hardest.

It won’t take long for de-dollarization to happen; Although BRICS had previously announced that the elimination of the US dollar is the “long-term goal” of this economic bloc.

Source: IRNA