Tehran sent a letter to the SCO in early 2022 suggesting that a new currency could help the Eurasian nations strengthen their bilateral trade with each other, according to Iran’s foreign minister for economic diplomacy, Mehdi Safari.

A Eurasian currency would also make it easier for these countries to circumvent unilateral Western sanctions, which are illegal under international law.

Such a development would directly challenge the US-dominated financial system and the status of the dollar as the de facto global reserve currency. The US dollar is still used in the majority of global trade transactions, although the overall percentage is shrinking by the year.

Brazil’s left-wing leader Lula da Silva has similarly pledged that, if he wins the October 2022 presidential elections, he will create a new currency for trade within Latin America, called the Sur (“South”), in order to combat “the dependency on the dollar”.

The Shanghai Cooperation Organization is a Eurasian political and economic alliance that brings together countries representing more than 40% of global population and roughly one-third of the world’s GDP.