At the age of 80, Luiz Inácio Lula da Silva pulled off a comeback through the runoff victory on October 25.  This lands as a genuine shock, as Lula lost the first round to the right-wing Flávio Bolsonaro by a margin of win million votes and then came back to retain his presidency. No one who lost the first round had achieved this turnaround since Brazil’s return to direct presidential elections in 1989. Brazil’s voters, especially the young Brazilian voters, pushed back against the anti-incumbent mood that has previously toppled several left-leaning governments across Latin America.

This domestic surprise carries clear consequences for international politics as well. A win for Flávio Bolsonaro would have pulled Latin America’s largest economy back into close alignment with Washington. The recent 18th BRICS summit held in New Delhi in September of this year focused on condemning war and aggression, pushed for trade in national currencies, criticized unilateral tariffs and sanctions, and treated de-dollarization as a necessity for broader stability. A rightward shift in Brazil would have pushed this agenda under real pressure and Lula’s victory keeps Brazil on track. 

Ideological Divides and Geopolitical Alignments

Latin America’s right has, historically, aligned with the United States. Even in recent times, right-wing leaders across Latin America have leaned toward the United States. From Jair Bolsonaro’s years to Javier Milei’s economic choices and Abelardo de la Espriella’s dependence on Washington, show a recurring pattern where these governments have consistently aligned their foreign and security policies with the United States.

Left-wing governments in Latin America, on the other hand, have more often prioritized Global South cooperation, regional coordination, climate change, combating gender discrimination, and efforts to reduce economic dependency on the Global North. Lula’s reelection locks Brazil into this camp and keeps the BRICS effort to build alternatives to the dominance of the US dollar firmly on the table.

Anti-Trumpism Helped Lula 

Lula entered the election campaign burdened by the weight of promises he had failed to deliver. In spite of beating expectations, Brazil’s economy is suffering from mounting debt, high interest rates and sticky inflation. Signs of economic slowdown are clearly visible, while the markets expect inflation to remain above the official 3 percent target until 2030. However, Lula cannot be held entirely responsible for this economic situation, as both houses of the Brazilian Congress are dominated by the conservatives. 

Yet, public frustration against Lula became clear as he lost the first round of the election to a right-wing opponent whose family had already tried to undermine the country’s democratic institutions. Nevertheless, Brazilian conservatives’ historical ties with the US and Lula’s vocal stance against Trumpism eventually paved the way for his runoff victory.

Not an Abstract Slogan Anymore

At the New Delhi summit, BRICS members focused on the issue of "de-dollarization" by advancing practical steps on local-currency settlement and payment systems because dependence on the dollar leaves countries exposed to external pressure. Lula is a vocal supporter of de-dollarization and has been advocating for it throughout the years of his previous term in office.  

Brazil is a major commodity exporter whose commercial ties to China have been rising rapidly, reaching a record $143.3 billion in the first months of 2026. Brazil’s push and support for de-dollarization under Lula give the effort substantial weight.

On the other hand, if Brazil had shifted its course and slowed or backed out of these mechanisms, the project might have lost the traction at this critical juncture of rising momentum for de-dollarization due to an unnecessary war against Iran, blockades and rising international stress resulting from them.

A Flávio Bolsonaro’s Win Risked U.S. Realignment

A win for Flávio Bolsonaro, backed by a conservative Congress, would almost certainly have realigned Brazil with the United States. Such a realignment would have made it harder for BRICS to maintain the consensus on local-currency payment systems.   

The Hormuz crisis has already demonstrated how fast energy trade can become an instrument of pressure. Countries that can settle more of their commerce without relying on the US dollar can reduce one obvious point of vulnerability. Losing Brazil’s active support and participation would have weakened the de-dollarization initiative when it was most needed. 

Internal Obstacles Slowing BRICS De-Dollarization

Yet, the larger obstacle to faster de-dollarization lies within BRICS itself. Strategic balance, uneven development levels, competing national priorities, and trade relations have tied most of its members to the US in one way or another, creating major roadblocks to de-dollarization. Additionally, internal friction between members has always limited the pace of the project as well.

Safeguarding the De-Dollarization Momentum

Still, these have not weakened the push for de-dollarization. The dollar’s dominance concentrates risk and it has become more visible as the world is knee-deep in the Hormuz Crisis and the Iran War. Lula’s reelection arrives at a critical juncture as BRICS has already taken concrete steps on local-currency trade. Lula, by winning the reelection, can maintain this momentum instead of freezing them.

BRICS has been pushing for de-dollarization through a decentralized strategy by focusing on alternative financial plumbing. Under this realistic approach, BRICS seeks to implement local-currency trade-settlements, interlinking domestic payment systems (BRICS Pay) and utilizing institutions like the New Development Bank.

Therefore, the practical next moves are straightforward. BRICS must follow through on the initiatives it has already taken. The bloc should expand bilateral currency arrangements where volumes already exist, and strengthen the New Development Bank’s capacity for local-currency lending. Despite political differences, the technical work on payment platforms should not stop.

None of these steps requires the elimination of the dollar from global trade. They require steady, practical progress while the current window remains open.

What Lula's re-election Means 

Lula’s re-election spared BRICS from an internal fracture at a moment when energy routes are contested and financial dependence carries higher costs. As Trump pressures countries back into Washington’s orbit, Lula’s Brazil keeps one of the few organized efforts toward currency diversification from stalling. 

Nevertheless, whether the effort eventually results in a more balanced system depends on how Brazil and its partners in BRICS utilize the political space that was nearly lost.

(The author is a postgraduate student in International Relations at Jahangirnagar University, Dhaka, Bangladesh. The views expressed are personal. He can be reached at 20212053725nur@juniv.edu / LinkedIn)