According to reports, the two BRICS nations will now trade in their own currencies. Beijing and Brasilia have agreed to stop using the US dollar as an intermediary and instead trade in their respective currencies. They also plan to expand their cooperation in the areas of food and minerals.
As per media reports, the arrangement will empower the two BRICS individuals to lead their huge exchange and monetary exchanges straightforwardly, trading renminbi without a doubt as well as the other way around, rather than involving the US dollar for repayments.
The Brazilian Trade and Investment Promotion Agency was quoted as saying on Wednesday, “The expectation is that this will reduce costs,” “promote even greater bilateral trade,” and “facilitate investment.”
The nations likewise supposedly declared the production of a clearinghouse that will give settlements without the US dollar, as well as loaning in public monetary standards. The move aims to eliminate dollar dependence in bilateral relations while also facilitating and lowering transaction costs.
According to an earlier announcement made by the People’s Bank of China (PBOC), these arrangements will make it easier for businesses and financial institutions in the two countries to conduct cross-border transactions using the renminbi and will also make investment and trade between the two countries easier.
For more than a decade, China has been Brazil’s largest trading partner, and last year, bilateral trade reached a record $150 billion.
Tatiana Rosito, Brazil’s Secretary for International Affairs at the Ministry of Finance, claims that 25 nations have already settled with China in yuan.