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Russia Gives Mixed Signals on BRICS Common Digital Currency – Ledger Insights
At last year’s BRICS (Brazil, Russia, India, China, South Africa) summit, the long-awaited announcement of a common digital currency gave way to talk of using local currencies for cross-border payments. Now BRIC it has grown from five to ten members and Russia currently chairs the organization. Last week Russian Deputy Foreign Minister Sergei Ryabkov discussed the topic, saying that the common currency is not a current priority. On the other hand, he stated that it would be possible to act very quickly, suggesting that finding a solution could take less than a year.
After the BRICS meetings in February this year, Russia talked about a BRICS Bridge payments platform without mentioning digital currency. Two BRICS members, China and the United Arab Emirates, are involved mBridge the similarly named cross-border central bank digital currency (CBDC) initiative. Using individual digital currencies for cross-border payments is a significantly different approach than using a common currency.
The governor of the Bank of Russia, Elvira Nabiullina, has already done so spoke on the complexity of creating a single BRICS currency. He made these comments before BRICS membership expanded.
Ryabkov BRICS comments on the common currency
“I wouldn’t say that this idea has been shelved,” Ryabkov said last week. “Although its implementation, as we all understand, involves, among other things, aspects such as the creation of a single issuing center, the creation of a Central Bank that sets a common base discount rate, as a possibility to take into account loan from the Central Bank through the banks of the participating countries”. This was stated in an automatically translated press conference, as reported by Ria Novosti.
“(We) agree that today the BRICS, which has 15 years behind it and has just doubled in size, is hardly ready for such steps and experiments. But this does not mean that this idea has been postponed.”
He added that “a bold enough and innovative enough scheme in this area will be worked out, and in a future that is not calculated in years and decades, but much faster.”
As context, during discussions in January on the current Russian CBDC pilot projects, central bank governor Nabiullina said that the CBDC platform was designed to support integration with similar foreign solutions. “We are currently conducting consultations and negotiations with many friendly countries, and of course with the BRICS countries, on cross-border payments via digital currencies.”