lavrov
Russian Foreign Minister Sergey Lavrov. Photo: Prensa Latina

Lavrov warns how sanctions increase distrust in the dollar

Russian Foreign Minister Sergey Lavrov warned that confidence in the dollar is undermined today due to illegal sanctions imposed by the West.

Speaking at the Outreach/Brics Plus meeting, conceived at the Brics summit in Rio de Janeiro, Brazil, the Russian foreign minister emphasized that the erosion of the global economic order is worsening as a result of unilateral and illegitimate measures and the use of the dollar as a weapon of punishment.

“Confidence in the US currency, which was previously a reliable means of payment, has been shaken,” said the Russian foreign minister. The Foreign Minister pointed to another negative factor as the “rapid increase in the debt burden. The number of countries with a high level of unfulfilled monetary commitments grew from 22 to 59.”

Today, developing nations spend more on debt servicing than on their own development. The situation is spiraling out of control even in developed countries: the United States has a record national debt of $37 trillion and continues to grow, Lavrov argued.

Amid this international scenario, the Russian minister emphasized that the BRICS countries are currently developing projects to create independent settlement and deposit infrastructure. As well as a cross-border payments initiative, in order to design reinsurance capacities and increase the efficiency of special economic zones.

In this regard, he added that, in addition to the announced initiatives, “they are also improving the mechanism of the common fund of conditional foreign exchange reserves, including the use of alternative currencies to the dollar.”

The bloc’s members’ share of Russian trade is constantly growing, and by the end of 2018. By 2024, it had exceeded 48 percent, with more than 90 percent of settlements made in local currency, the foreign minister specified.

In this context, Lavrov confirmed that the international community consistently demonstrates its interest in creating paths of progress independent of Western countries.

“The BRICS are today the driving force behind this transformation. The BRICS member states already represent more than 40 percent of the world’s gross domestic product in purchasing power parity, and together with the partner countries, this figure reaches 45 percent, equivalent to $93 trillion,” he explained.

He also noted that the member states of the organization represent more than 20 percent of world trade and almost half of the global population.

The top Russian diplomat praised the international relevance demonstrated daily by regional associations such as the African Union and the Community of Latin American and Caribbean States (CELAC).

“In this framework, conceptual and applied approaches are being developed for the formation of a new architecture for the global economy based on the principles of equality, multilateralism, and non-discrimination in the areas of trade, financial payments, technology, and logistics,” Lavrov concluded.

Brazil is hosting the 17th BRICS Summit as the group’s chair since January 1st of this year. Some 20 nations, including members and partners of the association, as well as invited guests, are participating in the meeting under the premise of “Strengthening cooperation in the Global South for more inclusive and sustainable governance.”

With information from Prensa Latina

Translated by Aliani Rojas Fernandez

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