Sunday, October 22, 2017

India and Brazil are the keys to whether the BRICS nations can overtake the Petrodollar and Bretton Woods system

While the Eastern and Eurasian blocs has made incredible strides over the past five years in attempting to set the world up for a post-Bretton Woods financial system, the West has achieved a certain amount of success in undermining the BRICS coalition that has been the biggest threat to dollar hegemony in the 70 years of its existence.  And if the economic group of Brazil, Russia, India, China, and South Africa are going to succeed in their plans for ending the Petrodollar and bringing back a system of bi-lateral trade, then two of those countries will need to experience a political change that currently has them strongly in the hands of Western control.

The election of Prime Minister Modi in India, as well as the coup in Brazil that led to the ouster of Dilma Rousseff in exchange for a Washington shill, has meant that both Russia and China have had to go it alone over the past two years.  And this has also meant that the BRICS have lost their cohesiveness in attempting to achieve a critical mass for change, leaving Moscow and Beijing to turn towards the Middle East in an attempt for the world to buy into a new financial paradigm.

Presently, BRICS is confronted with many challenges including establishing itself as an alternative to the Bretton Woods’s economy or western economy. BRICS has to evolve itself as an integrated politico-diplomatic force having a global voice and vision that would drive the Asian century. Thus, BRICS must subscribe to a combined economic development approach (CEDA) that distinguishes the BRICS from the Bretton Woods Economy based on the nexus of Dollar and Euro convergence.  Therefore, CEDA must be a reality in near future if it is not possible now. Currently, Indian and Brazilian economies are being controlled by the Bretton Woods institutions which are the traditional system for monetary and exchange rate management established in 1944 to help reconstruct the devastated Post World War-II economy and to promote international economic cooperation. 
Last fall, India had witnessed disastrous economic debacle in the wake of demonetization that put 80% of the cash currency in circulation out of legal use and got it replaced with new bills with the twin objective of flushing out black money and digitizing the economy. But it is still unclear how many poor perished due to this reckless exercise. People without bank accounts suffered a lot as they were able to make digital or online payments as an alternative to cash currency. Indian economy sustained another jolt that failed a myriad of small businesses leaving the Indian economy in adversity of crisis ramifications. 
There is a neo-liberal political leadership in Brazil confronted with corruption allegations which have been succumbing to the hawks of Wall Street and maneuvers of Bretton Woods’s systems. The BRICS 9th Conference at Xiamen on September 04-05, 2017 presented itself “BRICS: Stronger Partnership for a Brighter Future” but the partnership was not stronger, and future did not seem brighter rather it behaved like a private club where every member state was with a different agenda. Therefore, BRICS has to prove itself true to its name regarding economic accomplishments positively and constructively. – Modern Diplomacy
With both Russia and China forging headlong towards new digital currencies, as well as a the implementation of an Yuan denominated oil contract, the world is very close to being ready to have an alternative to the dollar and Petrodollar system... but only if there is enough critical mass to be able to effect this change.  And unless both India and Brazil experience a shift back towards the East through political changes at the top of their leadership, the probability of the BRICS disintegrating will be quite high, and Washington can then focus on nations targeted by Moscow and Beijing to replace these economies in their quest for change.

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