Eurasian Economic Union (EAEU) member states, the nations of Latin America, and other friendly countries should work together to build a new global monetary and financial system, including through the use of the latest digital tools. Doing so will reduce the hegemony of the dollar, help strengthen ties between countries, and boost trade. This was the conclusion reached by those attending the EAEU–Latin America roundtable, which took place as part of the Eurasian Economic Forum.
KEY CONCLUSIONS
Latin America is a reliable partner of EAEU member states
“We invariably pay a great deal of attention to working with Latin America. We have long‑standing ties characterized by friendship, cooperation, and mutual affinity,” Sergey Glazyev, Member of the Board, Minister in Charge of Integration and Macroeconomics, Eurasian Economic Commission.
“Today, it is crucial for the countries of Latin America, the Caribbean, and Russia to develop ways of working together,” Felix Plasencia, Secretary General of the Bolivarian Alliance for the Peoples of Our America – Peoples’ Trade Treaty.
“The potential is there across the whole of Latin America. We can accomplish this. We are a good partner for the Eurasian Union,” Nelida Guerra Moreira, Counselor of the Embassy of the Republic of Cuba in the Russian Federation.
“Today, Latin America is more important than ever to the EAEU. It is vital to boost cooperation on investment, trade, and economic matters,” Zhalyn Zheenaliev, Deputy Director, National Investment Agency under the President of the Kyrgyz Republic.
“The extensive contacts we can offer within the EAEU are also important. We maintain contacts with our colleagues responsible for relations with Latin America in various organizations, and we are ready for and open to contacts of this kind. I think that working together to come up with common approaches will benefit us all. <...> Fostering cooperation is very much a mutually beneficial undertaking,” Alexander Shchetinin, Director of the Latin American Department, Ministry of Foreign Affairs of the Russian Federation.
PROBLEMS
Comparatively little trade with Latin America and logistical challenges
“We can talk about stable relations between the Eurasian Union and Latin America; however, in numerical terms, this stability unfortunately only translates into 3% of trade. Paradoxical though it may seem, the current geopolitical shifts are leading to new opportunities opening up in this area,” Sergey Brilev, President, The Global Energy Association.
“As things stand, there’s little trade with Latin America – the region only accounts for 3% of our total trade. However, as you will appreciate, the potential for cooperation is enormous. Despite the geographical distances involved, we can work towards increasing trade,” Sergey Glazyev, Member of the Board, Minister in Charge of Integration and Macroeconomics, Eurasian Economic Commission.
“I see that due to high prices <...> Russian products are becoming uncompetitive on the global market. This is because the ports of St. Petersburg and Novorossiysk are not operating at full capacity due to the suspension of international shipping lines with Russia. What’s more, Russia does not have enough modern sea cargo ships,” Hulver Cesar Rezza Vega, President, Peru-Russia Chamber of Commerce and Industry Development.
“Trade and logistics issues are what need to be addressed. <...> In a certain sense, we have no clearly defined logistical routes to Latin America when it comes to exporting and importing. That said, the potential is there,” Zhalyn Zheenaliev, Deputy Director, National Investment Agency under the President of the Kyrgyz Republic.
The global hegemony of the dollar
“It became clear that unfriendly countries would use their monopoly on the key nodes of the global monetary and financial system for political purposes. This is what we are seeing today,” Sergey Glazyev, Member of the Board, Minister in Charge of Integration and Macroeconomics, Eurasian Economic Commission.
“Today, a great many people are talking about the global hegemony of the dollar. The dollar continues to exist, it continues to be supported, and continues to be used as an international reserve currency. However, at the same time, it is used as a means of payment, as a means of making international trade transactions. This explains the surplus-deficit ratio of North American trade – it is down to a terrible distortion. And all of humanity suffers as a result. Today, the entire world is a victim of the dollar’s hegemony,” Delcy Eloina Rodriguez Gomez, Executive Vice President, Minister of People’s Power of Economy, Finance and Foreign Trade, Bolivarian Republic of Venezuela.
“Latin America is faced with a challenge. It needs to cut ties with the dollar,” Ivan Acosta Montalvan, Minister of Finance and Public Credit of the Republic of Nicaragua.
SOLUTIONS
Moving over to national currencies and creating new financial mechanisms
“We have accomplished a great deal in moving over to national currencies in the Eurasian Economic Union, and we invite all our partner states to do the same. Today’s digital tools make this a fairly simple process. However, our central banks are seriously lagging behind in terms of launching national digital currencies. <...> Let us also consider the creation of a new global monetary and financial system. This has become a priority for at least three heads of state within the BRICS union. We propose that the summit in South Africa [the 15th BRICS Summit in Durban, set to take place on 22–24 August 2023 – ed.] is used to launch the process of creating a new monetary and financial system,” Sergey Glazyev, Member of the Board, Minister in Charge of Integration and Macroeconomics, Eurasian Economic Commission.
“We need to create a new international financial mechanism that will give genuine freedom to international trade,” Delcy Eloina Rodriguez Gomez, Executive Vice President, Minister of People’s Power of Economy, Finance and Foreign Trade, Bolivarian Republic of Venezuela.
“We think that in 2023, Latin America, African nations, and Eurasian nations should identify alternatives and create new platforms. <...> I think that trade between Russia, China, and India in roubles, yuan, and rupees offers a solution that will enable us to successfully meet our objective. It is about having a common currency, not just a national currency,” Ivan Acosta Montalvan, Minister of Finance and Public Credit of the Republic of Nicaragua.
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