There is no way that today’s international debt overhand can be repaid. That is as true for the United States as it is for Global South debtors. The US Treasury owes much more to foreign governments in the form of their holdings of US securities than it can foreseeably repay. It has post-industrialized its own economy, and has committed to spending enormous sums abroad, while its dependency on foreign imports is rising and its prospects for collecting its existing debt claims on deficit countries is looking shaky. The past half-century’s foreign investment has taken the form of privatization of the public domain of debtor countries. This investment has not helped them develop but has merely transferred ownership of their oil and mineral rights, public utilities and other assets. A viable international financial system requires productive investment such as China’s Belt and Road Initiative that can help countries prosper, not asset stripping. Dollar dominance will continue over Europe and other US satellites. Other countries that still need dollar reserves for their trade and investment with the United States can continue as it has. But what will be changed is a new basis for the international economy itself. There will not be a new BRICS currency in the sense of a dollar or euro that could become a medium for trade, investment or international speculation. There will only be a mutual "currency of settlement" of payments imbalances among central banks joining the new system. And that system itself will be based on principles opposite from the financialized neoliberal model being promoted by the Dollar/NATO bloc. That is the real context for the current discussion of BRICS+ economic reform.
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President Putin was very clear when he recently talked in Valdai about a single settlement currency: "This definitely deserves our attention. It's a complex issue, and we have to solve it in one way or another." The Western press talks about how much wealth and reserves do the BRICS countries have. Naturally, you count their gold as a large part of their reserves. But where is the gold of the BRICS countries? Much of their gold is not in their own countries. It's in the New York Federal Reserve Bank, it's in the Bank of England and the gold of African countries is in the Bank of France. Right now, this gold is being held hostage. But countries can ask the US, the UK and France to give them back their gold. Germany tried to do that a few years ago and said, "Can't you begin to give us our gold back that was moved to your banks during the last seventy-five years of US occupation? " And the US said, "Oh I'm sorry, we can't. We've already done something else with your gold. There are legal problems and we are not giving it back to you!" Now, let's say the BRICS countries would ask for their gold and if the United States and England and France will not return it, those countries could take compensation, including all of the foreign investments in their countries. They could do another thing: If, especially the African countries, say, "You've stolen our gold. You cannot expect us to pay our foreign dollar debts if you have come and seized our gold. Give us back our gold. You owe to us. And by the way, we're going to join the Shanghai Cooperation Organization so you can't send your troops in and do what you did in Libya and simply grab it." This is an element of the financial future that nobody in the West has talked about.
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