BRICS To End Dollar Rule And USA’s Supremacy!
- BRICS to end dollar rule and USA’s supremacy!
by Lubov Lyulko,
The BRICS countries (Brazil, Russia, India, China and South Africa) in late March held a summit in New Delhi, which can be considered the beginning of a new global financial and political order. In five years this world will be unrecognizable. The Anglo-Saxon model of governance of the world that flourished in the 1990s is losing its way and is being replaced by the Sino-Russian one. Yuan came close to international recognition, and with the adoption of Brazil and India into the UN Security Council the West will lose its political hegemony.
In 2008, the Wall Street’s practice of inflating financial bubbles in alliance with the U.S. Congress led to the collapse of neoliberalism. As Western politicians have not been able to build a coherent model of its resuscitation, the financial crisis is smoothly transforming into the political one. If President Obama advocates for the return of the industry to the country, what kind of subsequent prosperity of the United States are we talking about? The globalized economy has gradually shifted production to China, India and Brazil, where labor is cheaper, and tax and other legislation is much softer. So far there are no obvious reasons as to why Obama will return it to the United States.
This year, the BRICS countries provided 56 percent of world GDP growth, while the share of the richest of seven (G7) is only 9.5. In 2035 the BRICS countries will outrun G7 in terms of the economic potential. The volume of trade within the block grew from $27 billion in 2002 to $250 billion in 2011.
The main interests of the groups include the need to change the present world order, which is based on the global leadership of the U.S. dollar and its leading position as a major world currency. This order was approved by the agreements in Bretton Woods in 1944, at the end of World War II. The U.S. allies in Europe panicked before the inevitable spread of Soviet socialism and were happy to have hidden under the wing of the economically powerful neighbor in the Atlantic. The economic rationale for cooperation among the BRICS is clear today, but more serious political points of contact are found. Here Russia rules, because it was President Medvedev who most emphatically called for political unity. The unity for the first time was obvious on the Libyan issue.
The countries agreed to abstain on the vote of resolution 1973 of the UN Security Council, and after the military operation were critical of the coalition of NATO. This unity can be described today as “friendship against NATO.” Russia, despite a smaller contribution to the global economy (two to three percent of 18), is considered promising for investments due to the large potential of the consumer market and sustainable autonomous growth. South Africa (39 per cent of the GDP of all sub-Saharan Africa) joined the block on the invitation to make the alliance global and build a “bridge” to Brazil. In addition, the partners of South Africa in the BRICS gained access to the promising African market, which is particularly important for Brazil and China. At a recent summit in New Delhi two important statements were made. The first one is geo-financial (about creating a joint Development Bank in future) and the second – geopolitical (condemning the war rhetoric and sanctions of the West against Iran and Syria). It should be noted that the leading U.S. media angrily commented on these statements.
The Financial Times, for example, published an article stating that the BRICS countries are asking for more power in the IMF. The paper concludes that if the BRICS are unable to overthrow the American director and replace him with a single candidate, the block will cease to fund the IMF and will focus on the Development Bank mentioned in New Delhi. The American press has stressed that the Development Bank is not to rival the IMF. This is a strange statement, considering that the China Development Bank has a capital of two times greater than the entire capital of the IMF.
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