At the 2025 SCO summit, BRICS member China unveiled a plan to create a New Development Bank, which would provide loans in local currencies. This initiative aims to end China’s reliance on the US dollar.
Another important goal of this step is to reorient the global financial system towards developing countries and reduce dependence on the West.
The Shanghai Cooperation Organization (SCO) consists of 10 member countries: China, India, Iran, Kazakhstan, Kyrgyzstan, Pakistan, Russia, Tajikistan, Uzbekistan and Belarus.
SCO summit. Source: AFP
However, this plan could face serious obstacles. In particular, the SCO alliance is comprised of diverse countries with no unified position. The interests of India, Pakistan, and China diverge, while other member countries are not powerful enough to influence the global financial sector. The GDP of countries like Pakistan, Iran, and Belarus is declining.
Some countries lack economic independence, making it difficult for them to challenge anyone. Therefore, creating a new payment system in economically unstable countries is a challenging task. However, the road is clear to those who take it.