Brics new currency

You're referring to the BRICS (Brazil, Russia, India, China, and South Africa) bloc's efforts to create a new currency!

In 2014, the BRICS nations announced plans to create a new development bank and a reserve currency to reduce their dependence on the US dollar and other Western currencies. The idea is to promote economic cooperation and stability among the member countries.

The proposed currency is called the BRICS Contingent Reserve Arrangement (CRA) or the BRICS Reserve Currency. It's not a single, unified currency, but rather a basket of currencies from the five member countries, which would be used to settle international transactions and provide a stable store of value.

The BRICS CRA is designed to:

  1. Diversify the global monetary system: By creating an alternative to the US dollar, the BRICS CRA aims to reduce the dominance of the US dollar in international trade and finance.
  2. Promote economic cooperation: The CRA is expected to facilitate trade and investment among BRICS member countries, promoting economic growth and development.
  3. Enhance financial stability: The CRA is designed to provide a stable store of value and a means of settling international transactions, reducing the risk of currency fluctuations and financial instability.

The BRICS CRA is still in the development stage, and several challenges need to be addressed before it can become a reality. Some of the key issues include:

  1. Currency basket composition: The composition of the currency basket is still being debated, with different countries having different preferences.
  2. Weightage of each currency: The weightage of each currency in the basket is also a subject of discussion.
  3. Exchange rate mechanism: The exchange rate mechanism for the CRA is still unclear, with options ranging from a fixed exchange rate to a floating exchange rate.
  4. Governance structure: The governance structure of the CRA is also being debated, with different countries having different views on how the institution should be managed.

While the BRICS CRA is still in the development stage, it's an important step towards promoting economic cooperation and stability among the member countries.