WASHINGTON: The International Monetary Fund (IMF) is seeking further details on a cross-border payments system discussed by the BRICS group of countries aimed at facilitating non-dollar transactions, IMF Managing Director Kristalina Georgieva said Thursday.
The meeting BRICS—comprising Brazil, Russia, India, China, and South Africa—took place in Kazan, Russia, coinciding with the IMF and World Bank’s annual meetings in Washington. At the summit, Russia secured a joint declaration to strengthen correspondent banking networks within BRICS and facilitate payments in local currencies through the BRICS Cross-Border Payments Initiative (BCBPI), which is being positioned as a potential alternative to the global SWIFT payments system.
Russia has been barred from SWIFT since its 2022 invasion of Ukraine, and the BRICS initiative is viewed as a move to reduce dependence on the US dollar and Western financial systems.
“The idea of having a payments system for a group of countries is not new,” Georgieva said during a press briefing at the IMF’s Washington headquarters. “What we need to see is more details. What is it in this idea? How that may translate into reality? And then we will be able to assess it.”
The BRICS coalition has significantly expanded since its inception in 2009, now including nations such as Iran, Egypt, and the United Arab Emirates. Altogether, the group represents a substantial minority of global economic output.
Georgieva outlined two primary goals: ensuring inflation returns to central bank targets without triggering a deep recession, and addressing the “low growth, high debt path” faced by many countries.
She also spoke about the escalating conflict in the Middle East, which is impacting regional economies. “Egypt is losing 70 percent of the revenues it used to collect from the Suez Canal because of the impact of the conflict,” Georgieva said. Earlier this month, Egyptian President Abdel Fattah El-Sisi said that the country had lost approximately $6-7 billion in revenue this year, largely from a decline in Suez Canal traffic.
Georgieva welcomed progress in addressing debt crises through the Global Sovereign Debt Roundtable (GSDR), a forum for dialogue between creditors and countries in distress. She emphasized that while the GSDR is helping make the debt restructuring process more efficient, further efforts are needed to assist countries in debt distress more quickly.
“We need to do more to help countries in debt distress get back on their feet faster,” she added.
