Delegations representing eleven member states gathered at Bharat Mandapam in New Delhi for the 18th BRICS Leaders’ Summit without establishing a common currency or a shared settlement system capable of displacing the US dollar. Despite China recording a $1.19 trillion goods surplus in 2025 and a current-account surplus of 3.3 per cent of GDP according to the IMF’s February Article IV assessment, Beijing remains unwilling to open capital markets or surrender currency controls necessary for reserve status.
Capital controls restrict renminbi liquidity. A Strait of Hormuz crisis forced Indian refiners to import a record 2.78 million barrels a day of Russian crude in July 2026, defying trade commitments with Washington to preserve domestic energy security. Concurrently, Brazil signed the EU-Mercosur agreement in Asunción on January 17, 2026, creating a trade area of over 700 million people while retaining access to Western financial architecture. These divergent national interests prevent the formation of a unified anti-dollar monetary bloc.
The operation of the Cross-Border Interbank Payment System demonstrates the structural boundary between transactional settlement infrastructure and reserve currency issuance. While CIPS provides an operational alternative to SWIFT messaging during maritime supply disruptions, it cannot absorb sovereign capital surpluses without full capital account convertibility. The People's Bank of China prioritises domestic exchange-rate control over international renminbi liquidity.
Consequently, secondary market liquidity for Chinese sovereign debt remains insufficient to displace the Federal Reserve as the primary liquidity provider for global energy trade. Third-party commodity exporters operating through CIPS ultimately re-convert trade surpluses into US Treasury securities to maintain liquid emergency reserves. This cyclical capital flow preserves the structural dominance of the US Treasury market over non-Western payment networks.
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