Negotiations for a BRICS' own payment system are progressing.
Challenges were highlighted in the final document of the finance meeting.
Brazil Agency - Negotiations for a proprietary payment system among BRICS countries, which eliminates the need for conversion to the dollar, have progressed, according to the final communiqué from the group's finance ministers and central bank governors. The document stated that there has been progress in identifying possible pathways for the "interoperability" of member countries' payment systems.
According to the document, the countries made progress in recognizing ways to stimulate transactions in the local currencies of BRICS members and to reduce operational costs. However, the text does not detail the progress achieved. This is because negotiations will continue in the second half of the year, before India assumes leadership of BRICS on January 1, 2026.
“Following the instruction of our leaders in the Kazan Declaration [in Russia] to continue the discussion on the BRICS Cross-Border Payments Initiative, we acknowledge the progress achieved by the BRICS Payments Task Force in identifying possible pathways to support the continuation of discussions on greater interoperability potential for BRICS payment systems,” the statement highlighted in its 13th paragraph.
Although it does not detail the advances in the local currency payment system, the document cites efforts such as the report "BRICS Cross-Border Payment System," prepared by the Central Bank of Brazil. The document lists the preferences of the bloc's countries to facilitate "fast, low-cost, more accessible, efficient, transparent and secure cross-border payments."
According to the statement, an alternative payment system among BRICS countries could "support greater flows of trade and investment."
Reservation Agreement
The BRICS finance ministers and central bank governors announced a review of the Contingent Reserve Arrangement (CRA) to include new currencies. This is a mechanism for mutual financial assistance created in 2014 in case of balance of payments difficulties (external accounts and foreign investment).
Following the review of the agreement, the new rules will be discussed internally by the BRICS countries. Furthermore, a meeting in the second half of the year, with no date yet set, will discuss the accession of the new BRICS members to the CRA.
“We look forward to these changes as a basis for discussions aimed at increasing the flexibility and effectiveness of the ACR mechanism, notably through the incorporation of eligible payment currencies and improved risk management,” the statement highlighted.
Ecological transition
Regarding ecological transformation, the final communiqué reported that the BRICS countries have begun discussing a multilateral guarantee line. Assets used to cover potential defaults, guarantees reduce the risk of operations and improve the credit quality of countries in the Global South.
The future guarantee line will be developed by the New Development Bank (NDB), known as the BRICS Bank, without the need for countries to contribute additional capital to the financial institution. A pilot initiative will be developed in 2025 to report progress at the 2026 BRICS Summit in India.
Regarding the climate agenda, the final statement highlighted that the BRICS countries believe that "predictable, equitable, accessible and economically viable" financing is indispensable for just transitions and that, with the help of private capital, it will be possible to address global warming.
“We call on international financial institutions to expand support for [climate] adaptation and help create an enabling environment that encourages greater private sector participation in [global warming] mitigation efforts,” said the BRICS finance ministers and central bank governors.
Transactions
BRICS is a bloc that brings together representatives from 11 permanent member countries: Brazil, Russia, India, China, South Africa, Iran, Saudi Arabia, Egypt, Ethiopia, the United Arab Emirates, and Indonesia. Partner countries also participate: Belarus, Bolivia, Kazakhstan, Thailand, Cuba, Uganda, Malaysia, Nigeria, Vietnam, and Uzbekistan.
Under Brazil's presidency, the 17th BRICS Summit will take place in Rio de Janeiro on July 6 and 7.
The 11 countries represent 39% of the world economy, 48,5% of the planet's population, and 23% of global trade. In 2024, BRICS countries received 36% of all that Brazil exported, while we bought 34% of our total imports from these countries.
