Will BRICS Remove US Dollar Dominance? Saudi Arabia, Iran & the Alliance
The BRICS alliance, comprised of Brazil, Russia, India, China, and South Africa, is increasingly focused on reducing reliance on the US dollar in international trade. A key strategy for achieving this is the promotion of national currency transactions.
Saudi Arabia & BRICS: Will They Join?
The question of Saudi Arabia's membership in BRICS is a major point of discussion. Saudi Arabia was invited to join BRICS in 2025 but has not yet confirmed its membership as of early 2025. They did not withdraw from BRICS and joined other nations at the summit or other discussions. According to a new report by Reuters, two anonymous sources familiar with the matter say that Saudi Arabia – which was invited to BRICS in 2025 – is holding off on formally committing. This hesitancy raises questions about the future direction and potential influence of the expanded alliance.
Iran's Role in the BRICS De-Dollarization Effort
Alongside Saudi Arabia, Iran is also poised to play a significant role in the BRICS push for de-dollarization. Their potential integration into the alliance further strengthens the coalition aiming to challenge the US dollar's global dominance. Iran's extensive oil reserves and strategic geopolitical position make them a valuable asset within BRICS.
The BRICS Cross-Border Payment Initiative (BCBPI)
A central component of the BRICS strategy is the development of alternative payment systems. The BRICS Cross-Border Payment Initiative (BCBPI) will use national currencies, instead of the US dollar. Russia's finance ministry and central bank released a statement outlining their commitment to facilitating trade in rubles and other BRICS currencies. This initiative aims to bypass the US dollar-dominated SWIFT system and establish a more independent financial infrastructure.
Implications for the Future of the US Dollar
The combined efforts of BRICS nations, including potential members like Saudi Arabia and Iran, represent a significant challenge to the US dollar's global hegemony. While completely eliminating the dollar's influence is unlikely in the short term, the growing trend towards alternative currencies and payment systems signals a potential shift in the global financial landscape. The success of the BCBPI and the continued expansion of the BRICS alliance will be critical factors in determining the future of the US dollar's dominance.