IT’S OFFICIAL: BRICS BLOC EXAMINING ALTERNATIVE INTERNATIONAL ...July 2, 2015
Most regular readers here know that I and others have for some time been predicting that the BRICSA bloc, if they are to make their bi-lateral currency and trade agreements, bypassing the dollar, stick, and if they are to make their development banks truly be alternative competition for the financial instutions of the west such as the IMF and World Bank, then they will have to develop their own alternatives to yet another western financial institution: SWIFT, the Society for Worldwide Interbank Financial Transfer. They will, in short, have to develop their own international financial clearing system. While there has been talk suggestive of this possibilityin the past, it has fallen short of coming straight out and stating it...
... until now, in this article from RT, shared by Mr. J.T.:
The closest we've seen before this to such discussions have been with bilateral talks between Russia and China, which I covered in this blog last year: RUSSIA AND CHINA IN FORMAL TALKS TO ESTABLISH AN ALTERNATIVE TO SWIFT FOR INTERNATIONAL FINANCIAL CLEARING. But as can be seen from the RT article, this is now an explicit, BRICS-wide discussion:
"The BRICS members have kicked off consultations on an alternative to the global SWIFT system that processes about 1.8 billion financial messages annually, said Russian Deputy Foreign Minister Sergey Ryabkov.
The BRICS system for the transmission of financial information is expected to protect the member countries from any possible disruptions, and provide better security.
“The finance ministers and executives of the BRICS central banks are negotiating ... setting up payment systems and moving on to settlements in national currencies. SWIFT or not, in any case we’re talking about ... a transnational multilateral payment system that would provide greater independence, would create a definite guarantee for[BRICS – ed.]countries on risks associated with arbitrary decisions …made by countries that have current payment systems under their jurisdiction,”Russian Deputy Foreign Minister Sergey Ryabkov toldRIA in an interview published Wednesday. (Boldface emphasis added)
Just how quickly the BRICSA bloc will be able to implement such a system remains to be seen, but if current indicators are any measure, it will probably be a lot faster than the West would wish. After all, the bloc was able to develop its development bank in short order.
There's a geopolitical consequence here that, I am bold to suggest, few people are entertaining, but it is a significant one and one that, I suspect, the BRICS bloc are counting upon, and that is that once their clearing system is up and running, and a demonstrably stable and secure system, then it could very well be that other nations, particularly in Europe, will conduct their trade with the BRICSA bloc utilizing that bloc's clearing system, and bypassing SWIFT. And that means, in the long run, that they will slip more and more out from under the American thumb....
See you on the flip side...