What is BRICS explained | How CHINA is using BRICS to kill US Dollar | Abhi and Niyu

Summary

The video discusses the potential for BRICS (Brazil, Russia, India, China, and South Africa) to challenge US dominance by creating a new currency, possibly backed by gold, to end dollar hegemony. It explores the economic and geopolitical implications of BRICS, the history and development of the Euro as a model, and the necessity for India and China to improve relations to make a common currency feasible. The video emphasizes the importance of cooperation among BRICS nations and invites viewers to engage with the channel for more insights on geopolitics and economics.

Takeaways

• 🌏 India and China are rivals, but BRICS may bring them together.
• 🌐 BRICS includes Brazil, Russia, India, China, and South Africa.
• 💰 BRICS is planning a new currency to challenge the US dollar.
• 🔍 BRICS was formed after the 2008 financial crisis.
• 👥 23 countries, including Saudi Arabia and Iran, have applied to join BRICS.
• 📈 BRICS countries account for 42% of the world's population and 17% of global trade.
• 🪙 The new BRICS currency might be backed by gold.
• 🇪🇺 The creation of the Euro took a long time, and BRICS might follow a similar process.
• 💡 BRICS' ultimate goal is to reduce Western dominance.
• 🤝 For BRICS' success, India and China need to improve their relations.

Q & A

What is BRICS?

BRICS is an organization that brings together the top non-Western countries, namely Brazil, Russia, India, China, and South Africa, to collaborate on economic and geopolitical matters.

What is the rumored plan of BRICS regarding currency?

There are rumors that BRICS wants to create a currency that could potentially end the dominance of the US dollar.

When did BRICS start and why?

BRICS started after the 2008 financial crisis when Brazil, Russia, China, and India's leaders met for the first time in Russia. South Africa joined the group in 2010.

What is the significance of BRICS in terms of global population and trade?

BRICS represents 42% of the world’s population and accounts for 17% of global trade. The group also covers one-fourth of the world’s land.

Why is the US dollar considered a weapon in global finance?

The US dollar is seen as a weapon because the US can impose sanctions, like those on Russia during the Ukraine war, which include removing countries from the SWIFT system and freezing reserves, thus controlling global financial transactions.

How is China preparing for potential sanctions similar to those imposed on Russia?

China has been increasing the use of its own currency, the yuan, in global trade and has been preparing to face potential sanctions by building up its gold reserves and seeking alternatives to the US dollar.

What historical example is used to explain the complexity of creating a new currency?

The creation of the Euro is used as an example, which took over a decade of preparation, including the establishment of the European Monetary System and the Maastricht Treaty.

Why is the friendship between India and China crucial for the success of a BRICS currency?

A common currency for BRICS is seen as impossible until India and China, the two biggest players, resolve their differences and cooperate both economically and politically.

What were the consequences of the clashes between India and China in the Galwan Valley in 2020?

The clashes resulted in the death of 20 Indian soldiers, worsened relations, led to increased military presence at the border, and caused India to ban Chinese apps and raid Chinese companies.

What are the three critical aspects required for a new currency to be successful according to the video?

The three critical aspects are expansion (more countries joining BRICS), acceptance (countries making collective decisions), and trust (linking the currency's value to gold).

What are the benefits of the Euro that the BRICS currency aims to replicate?

The Euro brought economic stability, facilitated easier trade within Europe, and created neutral institutions like the European Central Bank, which increased political stability.

What steps are necessary for BRICS to create its own currency?

BRICS needs to enhance cooperation among its member countries, ensure economic and political collaboration, and possibly follow a model similar to the Euro, taking into account geographical and ideological differences.

Outlines

00:00

🌏 India's and China's Rivalry and BRICS

India and China are significant rivals globally, but BRICS (Brazil, Russia, India, China, South Africa) might offer a path to cooperation. BRICS, an organization uniting top non-Western countries, is rumored to be planning a new currency to challenge the dollar's dominance, potentially leading to de-dollarization and fostering collaboration between India and China.

05:01

🌍 What is BRICS?

BRICS was formed after the 2008 financial crisis, initially including Brazil, Russia, India, and China, with South Africa joining in 2010. Despite consisting of only five countries, BRICS has a substantial global impact, covering 25% of the world's land and 42% of its population. The group's goal is to counter Western power, as evidenced by the increasing number of countries interested in joining, including Saudi Arabia, Iran, and the UAE.

10:03

💰 BRICS' Economic Master Plan

The Russia-Ukraine war highlighted the US dollar's role as both currency and weapon, prompting BRICS to consider alternatives. With significant global trade in US dollars, BRICS members are increasing their gold reserves, signaling preparations for a new, gold-backed currency. Key to this plan are expansion, acceptance, and trust among BRICS countries.

💶 Understanding the BRICS Currency Concept

The process of creating a new BRICS currency can be compared to the Euro's development. The Euro, now used by 20 EU countries, was introduced after years of preparation and coordination. Similarly, BRICS would need significant time and cooperation to establish a new currency, addressing economic stability and political considerations.

🤝 India-China Relations and BRICS

For a BRICS currency to succeed, India and China must improve their strained relations, worsened by the 2020 Galwan Valley clashes. Despite ideological differences, cooperation between these Asian giants is crucial for BRICS' economic objectives. Upcoming events, like the G-20 summit in India, might offer opportunities for reconciliation.

📉 Conclusion and Future Prospects

Creating a BRICS currency is a complex but necessary step to challenge Western economic dominance. Increased cooperation among BRICS countries is essential. Viewers are encouraged to subscribe to the channel to learn more about global economics and geopolitics, as the world moves towards a multipolar future with multiple great powers.

Keywords

💡BRICS

BRICS is an organization consisting of Brazil, Russia, India, China, and South Africa. It aims to bring together the top non-Western countries to challenge Western dominance, especially in economic and geopolitical arenas. The video discusses BRICS' potential to create a new global currency and its implications for global power dynamics.

💡De-dollarization

De-dollarization refers to the process of reducing reliance on the US dollar for international trade and finance. The video suggests that BRICS countries are exploring the creation of a new currency to undermine the dollar's dominance, as evidenced by their increasing gold reserves and efforts to establish an alternative trading system.

💡Geopolitics

Geopolitics involves the study of the effects of geography on international politics and relations. The video explores how BRICS countries navigate geopolitical challenges, such as the US's economic sanctions and the potential for India and China to improve their strained relations through BRICS initiatives.

💡Economic sanctions

Economic sanctions are punitive measures imposed by one country (or group of countries) on another, typically to enforce international laws or standards. The video highlights the US sanctions on Russia following its invasion of Ukraine and discusses how these sanctions influence BRICS countries' push for a new global currency.

💡Gold reserves

Gold reserves are a nation's holdings of gold, used to support its currency and provide financial stability. The video mentions how BRICS countries have been increasing their gold reserves as part of their strategy to back a new global currency with gold, enhancing its stability and trust.

💡Euro

The Euro is the common currency used by many European Union countries. The video compares the process of establishing the Euro with the potential creation of a BRICS currency, illustrating the complexities and long-term efforts required to launch a successful multinational currency.

💡SWIFT

SWIFT is a global network for financial transactions, facilitating international money transfers. The video notes how the US used SWIFT to impose sanctions on Russia, highlighting the control that Western institutions have over global financial systems and the motivation for BRICS countries to seek alternatives.

💡Multipolar future

A multipolar future refers to a global order where power is distributed among multiple countries rather than dominated by a single superpower. The video envisions a future where BRICS countries collaborate to create a more balanced world, reducing the dominance of any single nation, such as the US.

💡G-20

The G-20 is an international forum for governments and central bank governors from 19 countries and the European Union. The video mentions the significance of G-20 meetings, particularly how they could facilitate discussions and cooperation between India and China, contributing to the success of BRICS initiatives.

💡Maastricht Treaty

The Maastricht Treaty, signed in 1991, established the European Union and led to the creation of the Euro. The video references this treaty to explain the lengthy and complex process of creating a new currency, suggesting that BRICS might follow a similar path to establish its own multinational currency.

Highlights

India and China are the biggest rivals, but BRICS could make them friends.

BRICS is an organization that brings the top non-Western countries together: Brazil, Russia, India, China, and South Africa.

Rumors suggest BRICS wants to create a currency to end dollar dominance.

BRICS countries represent 1/4th of the world's land and 42% of its population.

23 countries have applied to join BRICS, including Saudi Arabia, Iran, and UAE.

BRICS aims to challenge US dominance by bringing together the fastest-growing economies.

The US dollar is not just a currency but also a weapon, as shown by sanctions on Russia.

China's economy depends heavily on trade, and it fears US sanctions if it attacks Taiwan.

BRICS countries have been increasing their gold reserves to support a new currency.

A successful new currency needs expansion, acceptance, and trust.

BRICS' new currency plan draws lessons from the Euro, which took 10 years to prepare.

India and China must become friends for a BRICS currency to be feasible.

The Galwan Valley clash in 2020 worsened India-China relations.

China and India's friendship is crucial for BRICS' success.

The Euro brought economic stability and political cooperation in Europe, which BRICS can emulate.

Transcripts

India and China

are the biggest rivals in the world.

But there is a master plan

that can make both the countries friends

Or at least, can try

and that is BRICS

BRICS means a organization that brings

the top non-western countries together.

Brazil, Russia, India,

China and South Africa.

Today, rumors are that BRICS

wants to make a currency

that will end the dollar dominance

Is this the beginning of de-dollarization?

Can this be the reason

India and China become friends?

And how does it matter to us?

Let's find out in today's video

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Chapter 1:

What is BRICS?

BRICS started

after the 2008 financial crisis,

when Brazil, Russia, China, and India,

that is, India's leaders

met for the first time in Russia

South Africa became a part

of this group in 2010

If you see, BRICS

is a group of only 5 countries

but it has a very big impact

In total, the world's 1/4th land

and 42% population is included in BRICS

And among these 5 countries,

one or the other country

is part of the world's 17% trade

BRICS is so important

that 23 countries

have applied to become a part of it.

Including countries like Saudi Arabia, Iran, UAE.

Today, there is only one superpower in the world

and that is America.

Finance, technology, military,

if you look at it from all 3 angles,

there is no one country in the world

that can compete with America alone.

Not even China.

So if not one nation,

maybe a group of nations can challenge USA

BRICS is such a group

that wants to bring the fastest

growing economies of the world together.

This year, the members and leaders of BRICS countries

are going to meet in South Africa.

But what does it mean to come together?

Is it enough to just have meetings?

Or is it necessary to have some other objective?

In the early days, BRICS nations

had no particular goal.

But today, geopolitics

is taking shape in such a way

that BRICS' objective is getting clear.

And that is the end of the power of the West.

Chapter 2:

BRICS' economic master plan.

The Russian-Ukraine war

has reminded the whole world of one thing

that the US dollar is not just a currency,

but a weapon.

As soon as Russia attacked Ukraine,

America imposed various sanctions on Russia.

They removed Russia from the SWIFT

international money transfer system.

They froze their $300 billion reserves.

Today, 80% of the world's trade

is in the US dollar.

A country's central bank

keeps some stable foreign currency reserves.

Which are called Forex reserves.

Out of which, 59% of the reserves

are in US dollars.

And the US Fed controls these dollars.

That is not only in America,

but also outside America,

how can each dollar be used,

is fully controlled by America.

The Chinese economy

is completely dependent on trade.

One-fifth of China's total GDP

comes from its exports.

Just like Russia has an interest in Ukraine,

similarly China is interested in Taiwan

China wants to make Taiwan

officially a part of its mainland.

That means, today or tomorrow,

China will have to attack Taiwan.

And if this happens, then America

will impose sanctions on China as well.

This is the only fear that is stopping China

from attacking Taiwan.

That means, China will not be able

to trade with America and other major countries.

China is already preparing for this from 2009.

Because today, 6% of the world trade

is done in Chinese yuan.

This year, Alexander Babakov of Russia

said that Russia is focusing on making a new global currency.

The easiest way to understand China's economic master plan

is to put all the recent events on a timeline.

What have we seen so far?

In 2009, BRICS started,

and that too after the 2008 financial crisis.

After that, since 2014, every year,

BRICS countries have been meeting each other.

After the pandemic in 2020,

many countries

had to go through an economic crisis.

Many of them were refused help by IMF.

In March 2022, Russia invaded Ukraine

and the West imposed sanctions on them.

But the rest of the world

did not stop trading with Russia.

De-dollarization started from December 2022.

In this year, 2023

a major bank in America,

Silicon Valley Bank, collapsed.

And like 2008,

a similar situation was created.

The same situation

that gave birth to BRICS.

And since April 2023,

all the countries of BRICS

have been increasing their gold reserves.

India bought 3 tons,

Russia bought 31 tons,

and China bought 102 tons of new gold.

All these signals indicate that BRICS

is preparing to launch its new currency.

And that too a currency

that is backed by gold.

To make a new currency successful,

3 things are important.

Expansion, acceptance, and trust.

Expansion, when more countries

will be a part of BRICS.

Acceptance, when all countries

will be able to make decisions.

And trust, when the value of that currency

will be linked to gold.

And all these three directions,

work is being carried out.

Chapter 3:

Idea of the new currency.

Understanding the possibility

and process of BRICS currency

will be easier after understanding

the process of another currency.

This is Euro,

which is the central currency of Europe.

Which is used in 20 countries of the EU.

Along with that, these non-EU countries

also use Euro.

The point is that in 1979,

when EMS was launched.

EMS, means European Monetary System.

The main purpose

of EMS was to monitor at what rate

different European currencies will be exchanged.

Which is called ERM,

Exchange Rate Mechanism.

The idea of a single currency came in 1987

because of France and West Germany.

West Germany had deutsche mark

and France had franc as currencies.

But after a point,

deutsche mark as a currency

started becoming very strong.

Germany's economy

runs on manufacturing.

And by exporting their heavy machines and cars,

they run the country.

If the currency becomes very strong,

then it will be difficult for factory owners

to make things in Germany.

Because, laborers

will have to be paid more salaries.

If the prices are high,

the demand will decrease.

And in the long run,

the industry will be ruined.

On the other hand,

France's economy

was not growing as fast as Germany.

But because of ERM,

their currencies were tied to each other.

It was an economic disaster

that was waiting like a ticking time bomb.

To prevent this,

a treaty was signed in the countries of the European Union.

Which is called the Maastricht Treaty.

This treaty was signed in 1991

and Euro was launched in 1999.

But how?

This was not an overnight decision

like demonetization.

It took 10 years to prepare.

Even after the launch, for 3 years,

Euro was an invisible currency.

That is not in the hands of people,

It was only being used in accounting.

Today, there are 11 locations in Europe

where Euro is printed.

6 billion notes are printed every year.

Before Euro came, if a businessman

had to go to different countries in Europe

to do business,

he had to carry 10 different wallets.

In every wallet,

a currency of a different country.

And remember,

this is not the era of the internet.

Where we quickly open our phones

and check the currency rates.

For example, in Italian lira,

there were even 5 lakh notes.

And the French franc

would only print a 500 note at the max.

In the early times of Euro,

it was very complicated to calculate

all these transactions mentally.

For Europe, Euro was a very good idea.

Because, number 1.

The trade ties in Europe were very good.

Number 2.

The same currency

brought economic stability.

Number 3.

New and neutral institutions

like the European Bank were created

which increased political stability.

In short, in the story of Euro,

we understood

that even to make a currency like Euro,

it took a lot of time.

Because, it is not easy

to create a new currency.

Now, it is important for BRICS to think

that can we use the same model?

Can we create our own currency

and start trade in this new currency?

Chapter 4:

Friendship between India and China.

Jim O'Neill is an economist

who published a paper in 2001.

Where he, for the first time,

used the acronym BRIC.

He says that creating a common currency

is an embarrassing idea.

Because, until India and China

don't become friends,

until then a common currency

is impossible.

And if you look at the recent history,

you will understand why.

In 2020, in the Galwan Valley,

there were clashes

between the forces of India and China.

In which 20 Indian soldiers lost their lives.

After this moment,

the relations between India and China

got worse.

We sent 68,000 troops to Ladakh.

We banned 300 Chinese apps

and started tax raids on Chinese companies.

19 times, the armed forces of both the countries

met for military-level talks.

But, the armed forces of both sides

are manned at the border.

China for the last 10 months,

has not sent any ambassador to India.

Today, Western countries

feel comfortable seeing the rivalry between China and India.

Because, the concept of divide and rule

has not yet gone out of fashion.

India and China

are quite different ideologically.

We are a democracy

and China is a dictatorship.

India has diversity

and China has uniformity.

But, now if China wants to challenge America,

Russia, to control its economy

wants to make an alternative to the dollar,

then India and China

will have to come on the same page.

Because, ultimately,

these two countries

are the biggest players of BRICS.

Western media calls them

Asian giants.

China and India's friendship

can prove beneficial to all the countries of BRICS.

And efforts are also made in the right direction.

G-20 is happening in India

and it is possible that Chinese President,

Xi Jinping come to India.

When Xi Jinping came to India in 2017,

he started military de-escalation

to improve relations before that.

Similarly, there's a possibility even now.

Foreign ministries of both the countries

are talking about it.

BRICS' economic master plan

will be successful only when

we are ready to cooperate

economically and politically.

In conclusion, we have to realize

that the Euro,

which is a multinational currency,

took 10 years of preparation.

After the Euro was launched in 1999,

it was an invisible currency for 3 years.

It was not in the hands of the common people.

It was used only for some specific purposes

And that too in those countries

which are quite similar ideologically

and quite close geographically.

BRICS currency is an interesting idea

and quite necessary too.

That in the future is sure to be executed

to break the Western monopoly.

But before that,

cooperation needs to increase in these 5 core countries.

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