Russia has proposed the creation of a unified depository and clearing system for BRICS nations as part of efforts to deepen financial cooperation and bypass Western systems like Euroclear and Clearstream. The proposal, presented at the BRICS summit in Kazan, seeks to ensure seamless cross-border securities transactions through a new system called “BRICS Clear.” The initiative is driven by Russia’s need to develop alternatives to Western financial systems, particularly following sanctions imposed after its 2022 invasion of Ukraine.
President Vladimir Putin emphasized that BRICS’ expansion and development signal the emergence of a “multipolar world,” challenging the US-dominated global order. The group, which expanded in January 2024 to include the UAE, Iran, Egypt, and Ethiopia, alongside Brazil, Russia, India, China, and South Africa, represents a significant push for this new financial framework.
However, experts like Oleg Vyugin, a former Bank of Russia official, expressed skepticism about widespread adoption of the system, noting that many BRICS countries have strong economic ties with the West and may be reluctant to distance themselves.
Russia has been motivated to push for such systems due to the sanctions that froze its assets and cut off major banks from the SWIFT payment system. With around €173 billion in Russian holdings immobilized in Euroclear, Russia faces mounting difficulties with cross-border payments, including with allies like China, India, and Turkey.
Finance Minister Anton Siluanov has hinted that the BRICS Clear system would rely on distributed ledger technology. However, experts caution that alternative systems may not fully protect participants from the reach of Western sanctions.
Further discussions on the unified BRICS payment system are planned for December, with the potential for increased integration and a possible 5%-7% boost in trade between BRICS countries.
