THE BRICS ON THE ROAD TO DE-DOLLARIZATION

Abstract

This study examines the challenges and opportunities involved in creating a common currency among BRICS countries, amid growing efforts toward financial autonomy and global monetary diversification. It investigates the relevance of de-dollarization and the feasibility of the proposed R5 currency, drawing a critical comparison with the European Monetary Union and the creation of the Euro. A qualitative, bibliographic methodology with an exploratory and descriptive approach is adopted, using content analysis to organize existing knowledge on the topic. Findings reveal that BRICS countries broadly agree that the dominance of the U.S. dollar poses economic and geopolitical vulnerabilities, prompting interest in alternative arrangements. However, the R5 proposal faces significant economic, political, and technical hurdles, including structural asymmetries, difficulties in coordinating policies, and threats to monetary sovereignty. The comparison with the European Union highlights a wide institutional gap. The EU spent decades building political and economic integration before introducing the Euro, whereas the BRICS lack a comparable legal framework and supranational institutions. Therefore, the creation of a Euro-style common currency remains unlikely in the short term. Nonetheless, the study identifies pragmatic progress in de-dollarization. Initiatives such as the increased use of local currencies in trade, the development of payment systems outside the SWIFT network, and the growing role of the New Development Bank (NDB) illustrate alternative paths. The research contributes to the debate by showing that political will alone is insufficient; successful monetary integration requires a strong foundation of economic convergence and shared governance structures.