BRICS

The foreign ministers’ meeting will finalise the agenda for the 15th BRICS summit scheduled to be held in South Africa in August. Two items on the agenda are attracting notice for their potential for a greater geopolitical consolidation of the grouping: a plan to expand the membership of BRICS, and a common currency.

South Africa, which is in the chair this year, is hosting a Friends of BRICS meeting on Friday, with 15 foreign ministers from Africa and the Global South.

2. Multipolarity

• As many as 19 countries are said to be in the queue to join BRICS
• Among the countries that have been mentioned frequently since last year: Argentina, Nicaragua, Mexico, Uruguay, Venezuela from Latin America; Nigeria, Algeria, Egypt, Senegal, Morocco from Africa; Saudi Arabia, the UAE, Türkiye, Syria, Iran from West Asia; Kazakhstan from Central Asia; Bangladesh and Afghanistan from South Asia; and Indonesia and Thailand from South-east Asia
• It is not clear which countries might be admitted, but any expansion can be seen as strengthening the group’s heft as a spokesperson of the developing world
• By admitting some key countries in the list, BRICS could lay claim to representing more than half the world’s population. Significantly, the list includes big oil producers Saudi, Iran, the UAE, Nigeria, and Venezuela.
• There is considerable anti-US sentiment in the world, and all these countries are looking for a grouping where they can use that sentiment to gather together
• There is a lot of appetite for multipolarity, for a platform where countries of the Global South can express their solidarity

3. China in BRICS

• The idea of BRICS came between 2001 and 2003 from then Goldman Sachs chief economist Jim O’Neill, who projected that the four emerging markets of Brazil, Russia, India, and China would be the future economic powerhouses of the world, with South Africa being added later
• While the economic performance of BRICS has been mixed, the war in Ukraine  which has brought the West together on the one hand and strengthened the China-Russia partnership on the other  has turned it into an aspiring bloc that appears to be challenging the Western geopolitical view
• Significantly, China does not use the word multipolarity  instead using “multilateralism” whenever it hits out at “US hegemony”
• The theme of BRICS 2023 is: “BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development, and Inclusive Multilateralism”

4. India in BRICS

• If India’s presence at the G7 summit in Hiroshima, where Prime Minister Narendra Modi also participated in an informal Quad summit, was seen as a sign of New Delhi’s US tilt, the importance it attaches to the “anti-West” BRICS is an apparent contradiction  much like the several others it has negotiated through the last year
• On contrary, India should not be seen as ganging up with an anti-West coalition, India is also part of the Shanghai Cooperation Organisation (SCO), and despite problems, it has relations with Russia, with China
• Some analysts see BRICS as an improbable grouping, with hostiles like India and China unlikely to ever find common ground  a situation that could get pronounced as it adds members

5. Common Currency

• The idea of a common currency was proposed by Russia’s President Vladimir Putin at the Beijing BRICS summit last year
• The idea got a cautious reception, with the leaders deciding to set up a committee to study its viability
• The last year of war has seen economies around the world feel the impact of the sanctions on Russia, the resultant spike in energy prices, combined with the rising value of the dollar
• An insulation from the dollar is a tempting proposal, but not all members believe that it is an idea whose time has come
• There are other complications, such as the setting up of a common central bank of member countries that have different economic and political systems and are located on different continents
• An option is for members to trade with each other in their respective currencies — but as the India-Russia example has shown, this is not easy either
• Moscow wants payments in dollars because it does not import enough from India to use rupee payments

6. Significance of BRICS

• BRICS is an acronym for the grouping of the world’s leading emerging economies, namely Brazil, Russia, India, China and South Africa.

• The BRICS Leaders’ Summit has convened annually. It does not exist in the form of an organisation, but it is an annual summit between the supreme leaders of five nations.
• BRICS is successfully expanding its external relations that were established at the Durban meeting between the five BRICS leaders, the leaders of the African Union and the leaders of eight leading African integration associations.

• BRICS is an important grouping bringing together the major emerging economies from the world, comprising:

• 41% of the world population, 
• 24% of the world GDP 
• over 16% share in world trade. 
• The total combined area of 29.3% of the total land surface of the world
• BRICS countries have been the main engines of global economic growth over the years. 
• Over a period of time, BRICS countries have come together to deliberate on important issues under the three pillars:
• political and security, 
• economic and financial and 
• cultural and people to people exchanges.
• During the Sixth BRICS Summit in Fortaleza (Brazil) in 2014, the leaders signed the Agreement establishing the New Development Bank (NDB - Shanghai, China). They also signed the BRICS Contingent Reserve Arrangement to provide short-term liquidity support to the members.