Egypt's PM: BRICS Trend Toward Conducting Financial Settlements in Local Currencies

Egypt’s Prime Minister Mostafa Madbouly confirmed on Wednesday that there is a growing consensus within the BRICS bloc to shift financial settlements among member countries toward local currencies, reducing dependency on hard currencies like the U.S. dollar.

Speaking exclusively to Sada El-Balad during a press briefing, Madbouly said that several bilateral local currency settlement agreements are already being implemented within BRICS countries, and further expansion is expected.

“There is a clear trend within the BRICS alliance to conduct trade and financial settlements in local currencies,” the Prime Minister said. “This will begin with bilateral arrangements between member countries and may later expand into broader multilateral systems.”

Madbouly highlighted the benefits of such a system, especially in alleviating pressure on foreign currency reserves. “When there is a trade balance between two countries — and no significant surplus or deficit — local currency exchange in trade can ease the burden on foreign currency demand,” he explained.

The shift comes as BRICS countries, including Egypt — which formally joined the bloc in early 2024 — seek to strengthen financial sovereignty and reduce exposure to currency volatility and external monetary policies.

The idea of de-dollarization has gained momentum among BRICS nations in recent years, particularly in the context of global geopolitical shifts and disruptions in international payment systems. The move also aligns with the group’s efforts to create alternative financial mechanisms and foster South-South economic cooperation.

Earlier this week, Egypt and China signed three financial cooperation agreements between their respective central banks and private sector financial institutions, including deals to promote trade in Chinese yuan and expand cross-border payment networks.

Analysts say Egypt’s active role in these developments reflects its growing strategic alignment with BRICS economic goals, particularly in boosting trade, investment, and financial independence.