BRICs and South Africa move to unseat dollar as trade currency
By Thandeka Gqubule and Andile Ntingi
City Press, Johannesburg, South Africa
Sunday, March 25, 2012
South Africa this week will take some initial steps to unseat the US dollar as the preferred worldwide currency for trade and investment in emerging economies.
Thus the nation is expected to become party to endorsing the Chinese currency, the renminbi, as the currency of trade in emerging markets.
This means getting a renminbi-denominated bank account, in addition to a dollar account, could be an advantage for African businesses that seek to do business in the emerging markets.
The move is set to challenge the supremacy of the US dollar. This, experts say, is the latest salvo in the greatest worldwide currency war since the 1930s.
n the ’30s, several nations competitively devalued their currencies to give their domestic economies an advantage over others.
And this led to a worldwide decline in overall trade volumes at the time.
The north will be pitted against the entire south in a historic competitive currency battle — whose terrain has moved to the Indian capital, New Dehli — where the Brics (Brazil, Russia, India, China, and South Africa) nations will assemble next week.
China seeks to find new markets for its currency and to lobby to internationalise it throughout the Brics states.