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The BRICS mock-up bill that was gifted to Putin
(lemmygrad.ml)
Imsgine how good a BRICS currency would be for the world ππππ
The graphic design of the bill is wack (complete lack of symmetry with the landmarks. Some start at the inner circle which looks nice, some start at the outer circle, like the taj mahal, which looks out of place as a result).
But a unified brics currency is just a bad idea and replicates the problem of the euro and the usd. You should only use a united currency for an economy under a common economic plan.
The level of inflation and interest rates on a currency that are good for a currency depends significantly upon the country. Basically, if N countries combine their currency, you go from 2N levers (interest rate and reserve requirements for each country) to just 2 levers (1 rate and 1 reserve ratio for all countries). Capitalist economies already have trouble moderating economic activity, reducing the available controls is not ideal. This is pretty much the problem the EU faces.
A much better idea would be a unified brics payment system, with 0 foreign exchange fees and real time conversion. This would give you the benefits of a unified currency (each cross border payments) while still allowing countries to diverge on monetary policy.
If I'm not mistaken, I think this is how the BRICS currency is supposed to work. Like countries have a dynamic exchange rate with it but it provides a common basis for denominating trade. And that way there is a common medium of exchange so trade with one partner does not create an obligation to you since they do not gain a reserve of your own nation's currency but of a currency acceptable to all members.
Making a reserve does seem like a more sensible approach than a unified currency, but there is still the question of who issues the currency and with what rates. It seems somewhat unnecessary (given my admittedly amateur knowledge) to create a new currency.
Setting the rates too high on the currency will stifle investment, while setting the rates too low will make using the currency unappealing. The problem is that the "ideal" rate differs depending on the profit rates in each country (which diverge significantly from each other).
I mean, the obligation still exists. The obligation is just to BRICS as a whole instead of one country. I guess that might be a nice benefit.
Of course the obligation still exists but it's a much wider and potentially-more-beneficial-to-fulfill obligation than exists in trading in sovereign currencies directly.