During his first state visit to China since taking office in January, Brazil’s president, Luiz Inácio Lula da Silva, urged developing nations to collaborate in finding an alternative currency to replace the US dollar for international trade. Lula’s call echoes Beijing’s efforts to end the greenback’s supremacy in global commerce. He specifically urged the Brics nations, comprising Brazil, Russia, India, China, and South Africa, to work towards developing their own currencies for use in trade.
Former Brazilian president Luiz Inácio Lula da Silva has called for an end to dependence on the US dollar for international trade, and instead trade using local currencies. Lula made the remarks in a speech at the New Development Bank in Shanghai, drawing applause from the audience of Chinese and Brazilian dignitaries. The call for change comes amid Chinese efforts to increase use of the renminbi in cross-border commodities trades and expand its role in the global financial system. Lula’s comments also reflect a shift in Brazilian foreign policy to a more multilateral approach, emphasising good relations with the US, China, and other developing nations. Lula’s far-right predecessor, Jair Bolsonaro, prioritised bilateral ties with the US under former president Donald Trump. Lula’s call for change coincides with Chinese President Xi Jinping’s visit to Brazil, where he will seek to persuade the Brazilian leader to back a range of Beijing’s foreign policy initiatives, including the Belt and Road trade and infrastructure programme. Bilateral trade between China and Brazil has grown significantly, with trade reaching $150.4bn last year, leading to calls for greater use of the two countries’ respective currencies in bilateral trade. While any effort to spurn the US dollar will face a substantial challenge, the Chinese currency’s share of trade finance has already doubled to 4.5% since Russia’s full-scale invasion of Ukraine last year.