When we speak about the idea of de-dollarisation and we have seen countries like India for instance, we have publicly stated that we are not going to move away from the dollar and de-dollarisation is not a policy that India essentially is looking at. But is there an immediate threat to the United States or to the G7 group of nations from BRICS because Donald Trump is making these comments over and over again. So, do you anticipate an immediate threat A) to the dollar and, of course, to US’ hegemony?
Geoff Dennis: I do not believe so. This is an issue which has allegedly impacted markets for the best part of 50 years. I am an old guy, I have been around a long time and we were talking about potentially the Deutsche Mark replacing the US dollar as a key reserve currency or the key reserve currency in the late 70s and it has just never happened. Now, right now there is some evidence, of course, that central banks are diversifying out of the dollar.
The Chinese are desperate for the RMB to play a bigger role. But frankly, I do not see what the BRICS are doing or what they are trying to do represents a currency related threat to the US whatsoever. I just do not get it frankly. And so, there is some de-dollarisation going on for sure, but I am not sure it is major and I am not sure it is involving the BRICS. In fact, frankly, my own interpretation of all of this is that anything that anybody does overseas, especially if countries get together is almost automatically defined by Trump is anti-America and there is nothing about what the BRICS are doing that is really seriously anti-America and this all boils down at the end of the day to the fact that I just think de-dollarisation is not something that is going to go far in the world even if the dollar’s really truly dominant position has pulled back a little bit over the last few years.
Given the fact that the reform Bretton Woods and reduce dollar reliance in fact is not new, but is BRICS gaining structural momentum this time in your opinion?
Geoff Dennis: It is gaining structural momentum in the sense that you have got a number of other large countries as everybody knows joining BRICS that over and above the original BRICS which was defined by my old friend Jim O’Neill in 2001 which was, of course, just Brazil, Russia, India, China. There are some very important countries that have joined. But still I am not sure exactly what a BRICS summit achieves.
Yes, they say all the right things about we support free trade. We condemn tariffs whatever it might be or non-tariff barriers, but as to how much power this group actually can demonstrate currently in the world economy especially against a US president who frankly is a bully to everybody who seems to threaten in some vague way the US dominant position of the world economy.
So, I think it does not sort of matter to me within reason what the BRICS does at this point, whether it gets bigger, whether it gets smaller, whether a lot of presidents and heads of state come to the conferences or not.
At the end of the day I do not think it has a lot of power except to say all the right things about trade policy and meanwhile President Trump is rampaging around the global economy like a bull in a China shop and the BRICS will become part of that unfortunately and yet, I do not know how the BRICS particularly fights back and I certainly do not see it as I said earlier being something that is going to turn into a brics-led currency, whatever reserve currency that is going to replace the dollar. The problem here is Trump’s tariff policy and it is as simple as that frankly.
