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De-Dollarisation

The document discusses the need for reshaping Bretton Woods Institutions through de-dollarization, particularly from the perspective of the Global South and the rise of BRICS. It explores how de-dollarization serves as a counter-dependency tool while addressing structural disadvantages faced by the Global South in the global financial system. The analysis highlights both the potential and limitations of de-dollarization in achieving greater economic sovereignty and reducing dependency on the U.S. dollar.

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208 views15 pages

De-Dollarisation

The document discusses the need for reshaping Bretton Woods Institutions through de-dollarization, particularly from the perspective of the Global South and the rise of BRICS. It explores how de-dollarization serves as a counter-dependency tool while addressing structural disadvantages faced by the Global South in the global financial system. The analysis highlights both the potential and limitations of de-dollarization in achieving greater economic sovereignty and reducing dependency on the U.S. dollar.

Uploaded by

alternatehola01
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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The Global South

and Economic
Multilateralism:
How to build a new
architecture for
Bretton Woods
Institutions with
De-dollarization
The Global South and
Economic Multilateralism
 Reshaping Bretton Woods Institutions through
 De-dollarization
 A Dependency Theory Perspective
Introduction
 Overview of 1944 Bretton Woods system
 Dominance of the U.S. dollar in global finance
 Structural disadvantages for Global South
 Rise of BRICS as a challenge to status quo
Research Questions
 To
what extent have BRICS operationalized de-
dollarization?
 Howdoes de-dollarization function as a counter-
dependency tool?
 What are the theoretical and practical limits?
Theoretical Framework:
Dependency Theory
 Origins in Latin American structuralism
 Key
thinkers: Andre Gunder Frank, Samir
Amin, Theotonio Dos Santos
 Underdevelopment as part of global
capitalist system
 Peripheral dependence on the core
 Global institutions reinforce dependency
Data Sources
 IMF
COFER (2020–2024) – reserve
composition
 SWIFT currency transaction data
 Bilateral
trade data (India–Russia,
China–Brazil)
 NDB, CRA, BRICS reports
 Central bank and academic literature
Bilateral Agreements
 China–Brazil renminbi-real clearing (2023)
 India–Russia rupee-ruble settlement post-Ukraine
sanctions
 Growing share of non-dollar trade (40–45%)
 Energy, agriculture, manufacturing sectors
Regional Financial
Infrastructure
 New Development Bank (NDB): local
currency loans
 Contingent
Reserve Arrangement (CRA):
emergency swaps
 SPFS (Russia), CIPS (China): SWIFT
alternatives
 BRICS Pay: under development
Digital Currencies (CBDCs)

 Brazil’s Drex, India’s Digital Rupee, China’s e-CNY


 Potential for cross-border CBDC settlement
 BRICS-wide interoperability discussions (since
2022)
Structural Factors Addressed
 Currency hegemony: diversification
 Debt regime: local currency loans
 Trade settlement: non-dollar commodity trade
 Liquidity: CRA vs. IMF bailouts
Dependency Analysis
 Modified Prebisch-Singer structuralist approach
 Dollar
dependence index: local settlement +
reserve diversification
 Example: India 2020–2024 shift
 Weighted by import/export sensitivity
Bretton Woods vs. BRICS

 IMF liquidity support → CRA swap lines


 USD-based trade → Local currency agreements
 Dollar reserves → RMB/INR/Gold diversification
 SWIFT control → SPFS, CIPS, BRICS Pay
Constraints and Limitations

 Non-convertibility of RMB, INR


 Political tensions (e.g., Sino-Indian rivalry)
 Private sector USD preference
 USD’s enduring global dominance
Key Takeaways
 De-dollarization offers incremental sovereignty
 Challenges structural asymmetries, but only
partially
 Dependency persists without tech, capacity,
strategy
Conclusion

 BRICS reflect monetary multilateralism shift


 Dependency theory shows potential + limits
 De-dollarization necessary but insufficient alone

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