The reform of the international monetary system has been a subject of constant debate, reflecting widespread dissatisfaction with the dollar-based and US-controlled arrangements that have prevailed since World War II. The United States is very much attached to its privileged and dominant position, and is unwilling to seriously contemplate any changes to it. The rest of the world is increasingly uneasy with the way the US handles its dominance. Heavy-handed weaponization of finance and, since 2025, of trade policy have weakened confidence in the dollar and US Treasuries. Moreover, the weak spots of the American economy, including severe fiscal and financial fragilities, sow suspicion about the trustworthiness of dollar assets. There is, therefore, an undeniable need for alternatives – a need that may become urgent if a new financial crisis erupts in the United States. This is the background for the present paper.
Most of the alternatives to the dollar system that have been proposed often seem unrealistic and impractical. This appears to be the case of proposals for a global solution, normally SDR-based, and of regressive reforms that seek to establish gold and/or other commodities as the anchor of a non-fiduciary monetary framework. A global solution cannot be seen as feasible, given the current and probably longlasting geopolitical fragmentation of the world. And the assumed safety and neutrality of Keynes’ “barbarous relic” provides at best, as it already does, a volatile international reserve asset.
A different approach is presented here, one that seems more consistent with contemporary realities. Its main purpose is to provide a comprehensive explanation of a how a new plurilateral BRICS-centric reserve currency could be constructed. This currency would share some basic traits with contemporary currencies that are normally fiduciary, floating, and managed by relatively autonomous monetary authorities.
The paper starts off with a survey of the current monetary landscape, and argues that the lack of acceptable alternatives to the dollar opens the way for a new transnational currency. The only other major alternative, the renminbi, appears not to be a feasible or desirable alternative for reasons that will be set out in some detail. The case is then made for a new reserve currency, restricted to international transactions and reserve holdings and playing no domestic roles. The paper then addresses the main reasons for and the distinctive features of such an initiative. Could the issuance and management of a new currency be entrusted to an existing institution? Or would the creation of a new one be required?
This is a shortened version of a paper concluded in April. The full report you can read here: Nogueira Batista Jr., Paulo (2026). “Geopolitics and International Money—A Path to a New Reserve Currency”, April. URL: https://www.nogueirabatista.com.br/2026/04/16/geopolitics-and-international-money/
The Valdai Discussion Club was established in 2004. It is named after Lake Valdai, which is located close to Veliky Novgorod, where the Club’s first meeting took place.
Please visit the firm link to site
