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Gold-backed BRICS currency will benefit Iran, weaken US dollar, euro: Sr. diplomat

The file photo shows the heads of the BRICS member states.

A senior Iranian diplomat has hailed a plan by the BRICS member states to introduce a common currency in their international trade, emphasizing that the move will prove beneficial to Iran and challenge the dominance of the US dollar and the euro.

“A tremendous change is taking place in the international economy,” said the head of Iranian Foreign Ministry's South Asia Office, Rasoul Mousavi, in public remarks on Sunday.

“The BRICS’s introduction of a gold-backed currency, which is supported by 41 countries with large and influential economies, will weaken the dollar and the euro and will benefit countries such as Iran, while Iranians in possession of gold will experience a growing worth of their wealth,” Mousavi added.

The BRICS alliance -- with Brazil, Russia, India, China and South Africa as primary members -- recently announced plans to float a gold-backed currency to settle international trade payments to challenge the global reserve status of the US dollar.

The bloc of the five nations is projected to decide on introducing the new BRICS currency during its next summit in Johannesburg, South Africa, in August.

The Russian government confirmed a day earlier that Brazil, Russia, India, China and South Africa would introduce a new trading currency backed by gold.

The state-run RT also reported that the initiative was adding new momentum to the ongoing de-dollarization trend unfolding in the global economy.

BRICS member states account for more than 40 percent of the global population and around a quarter of the global GDP.

The news comes as the global trend of substituting the US dollar with local currencies in the trade of goods and transactions has been on the rise, with countries hoping to reduce their dependence on Washington and prevent it from further exploiting its power and weaponizing its global dollar dominance.

Even though many economists say no other currency can dominate over the US any time soon, prominent economists including US economist Nouriel Roubini, who predicted the financial crisis of 2008, do not rule out the eventual demise of the dollar as a reserve currency within a decade.

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