In an ambitious move indicative of evolving global finance, China and Russia are set to accelerate their development of a revolutionary payments infrastructure that will serve the economic partnership known as BRICS. The robust system is set to revamp international trade by integrating the nascent BRICS currency and streamlining cross-border transactions.

New horizons in BRICS payment infrastructure

Igor Shuvalov, the Chairman of Russia’s National Economic Development Institution, known as VEB.RF, is a key advocate for the urgency of the project.

Speaking ahead of the upcoming BRICS summit, Shuvalov implored leaders of the Russian Federation and China to expedite progress in building the payments system.

The new payment architecture, which Shuvalov described as leveraging “cutting-edge” technology, is expected to be officially unveiled after the summit, scheduled for August 2023 in Cape Town, South Africa.

In addition to serving the BRICS nations—Brazil, Russia, India, China, and South Africa—this new payment infrastructure is planned to incorporate the Shanghai Cooperation Organization (SCO) group, a move that stands to facilitate seamless money transfers on the global stage.

Shuvalov emphasized the need for “an independent and efficient infrastructure of payments” that can enable smooth transactions not just for the ‘ruble/yuan’ pair but for the broader BRICS and SCO currencies.

This development has the potential to foster trade within and beyond the BRICS and SCO blocs, bolstering their economic might on the world stage.

Navigating global currency dynamics

The driving force behind the development of the new payments system is the joint ambition of Russia and China to recalibrate the global financial landscape, currently dominated by the U.S. dollar.

However, this assertive stance has triggered internal fissures within the alliance, with India expressing skepticism towards China’s agenda.

Concerns have surfaced in India regarding China’s alleged use of the BRICS partnership as a stepping stone towards its aspirations of global dominance.

Yet, despite these political tensions, the economic benefits of the new payments infrastructure might potentially outweigh such strategic concerns.

In affirming the importance of Russia-China relations, Russian Prime Minister Mikhail Mishustin praised the strengthening ties between the two countries. He emphasized the historical roots, mutual respect, and friendship that underpin this partnership.

The proposed payment system, Shuvalov argues, is set to be a key tool to deepen trade and economic cooperation between the BRICS nations and within the broader SCO alliance.

The China Development Bank (CDB) and other financial institutions within the SCO and BRICS nations could potentially play crucial roles in supporting these efforts.

This initiative has been conceived at a critical juncture in global economic relations. As both the BRICS and SCO blocs look to enhance their influence and autonomy in the world economy, the establishment of a dedicated payments system marks a significant step towards this goal.

In the current climate of economic realignment, the new payments system could redefine the dynamics of international trade, bolstering the economic standing of the BRICS nations while challenging the hegemony of the U.S. dollar.

Only time will reveal the full implications of this ambitious venture and its potential to reshape the global financial landscape.

This article orginally appeared at: www.cryptopolitan.com