Celso Amorim, Brazilian President Luiz Inacio Lula da Silva’s chief adviser on foreign policy, has emphasized the importance of de-dollarization in an interview with the Chinese government-owned Global Times. Amorim, who previously served as Brazil’s Minister of Foreign Affairs, Minister of Defence, and ambassador to the United Kingdom, explained the significance of Lula’s visit to China, where the Brazilian president met with Chinese President Xi Jinping. It was Lula’s first visit outside the American continent after assuming office on Jan. 1. Brazil and China have agreed to conduct trade in their respective currencies, rather than using the U.S. dollar, a move that could help build a less centralized world with no hegemony.
Amorim believes that Brazil and China are coming closer together, and both countries are part of the BRICS group that is working to create a new form of currency that will further shift them away from USD reliance. The BRICS countries consist of Brazil, Russia, India, China, and South Africa. Amorim says, “I think it’s natural that we can do our own trade in our own currencies … It’s only natural because the dollar has become dominant after WWII; before it was the English pound … So now, if we can work with a basket of currencies and use our own currencies to a large extent, that’s the best thing.”
While it is “not yet totally clear” whether the BRICS nations will adopt a common currency or maintain their respective national currencies, Amorim stresses that it is important to be “free from the dominance of one single currency because sometimes it is used politically.” The U.S. dollar may lose its status as the world’s reserve currency due to the government weaponizing it, warns economist Jim Rickards. Investment manager Larry Lepard predicts that the USD could lose most of its value in five years. Economist Nouriel Roubini says the global reserve currency system is shifting from unipolar to bipolar with the Chinese yuan as an alternative to the U.S. dollar.
Amorim believes that Brazil and China can play important roles in building a more multipolar world, in which power is less centralized and there is no hegemony. He says that China is Brazil’s most important trading partner by far, and Brazil is becoming one of the places in which China invests more. Amorim further stresses that Brazil is eager to enhance its strategic cooperation with China, and he believes Lula’s visit will elevate the relations between Brazil and China to a new level. He also urges developing countries to cooperate more closely.
Lula recently called on developing nations to dump the U.S. dollar as the world’s reserve currency. It is important to note that this article is for informational purposes only and is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice, and neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.