The 15th BRICS Summit concluded on August 24 in the South African city of Johannesburg, with member states reaffirming their commitment “to the spirit of mutual respect and understanding, sovereign equality, solidarity, democracy, openness, inclusiveness, strengthened collaboration, and consensus”. The summit advocated for “a more representative, fairer international order, a reinvigorated and reformed multilateral system, sustainable development, and inclusive growth.”
The acronym BRIC, which did not initially include South Africa, was coined in 2001 by then Goldman Sachs chief economist Jim O’Neill in a research paper titled ‘‘Building Better Global Economic BRICs’’ that underlined the growth potential of Brazil, Russia, India, and China. He predicted that the emerging economies would register GDP growth and dominate the world economy by 2050, with important implications for “global governance arrangements”. He, however, did not suggest setting up a separate group of emerging economies; rather, he advocated for bringing them into an expanded G-7.
BRICS encompass more than 26.7 per cent of the world’s land area (39,746,220 sq km), 41.5 per cent of the world’s population (3.21 billion), and a quarter of global GDP. All BRICS states are members of the G20 with a combined gross domestic product (GDP) of around US$56.65 trillion, which is larger than that of the G7 in purchasing power parity terms. The increasing quantity of trade and political cooperation among members is creating a new, potentially powerful, global grouping.
The BRICS summits, throughout its inception, have recurrently remained preoccupied with certain key issues, like the emphasis on a multi-polar order, the call for UN reform and democratisation of the institutions of global governance to ensure respect for the sovereignty of states and international law, the condemnation of terrorist activities, the settlement of disputes by means of multilateral diplomacy, and the primacy of the UN Security Council for the use of force as a last resort.
Founded on the ideational principle of the Non-Aligned Movement and the Bandung principles as a critique of the Western-dominated global order, BRICS is “pursuing a global order where great power is contained so that it is impossible for one state, or group of states, to impose their specific ideology on the rest of the system, or impossible to manipulate the international system to serve their national interests without regard for the common interests of states.”
The Johannesburg II Declaration, a 94-points document adopted at the summit, emphasised strengthening the framework of mutually beneficial cooperation under the three pillars of political and security, economic and financial, and cultural and people-topeople cooperation.
The declaration also advocated for enhancing strategic partnerships for the benefit of the people. BRICS leaders have also agreed to agitate for the reform of economic policies and to manage the implications of rising geopolitical tensions on global financial stability.
The declaration also highlights inclusive multilateralism, peaceful development, mutually accelerated growth, sustainable development, people-to-people exchanges, and institutional development and calls for the reform of international institutions like the UN, the IMF, and the World Bank.
The Declaration expressed concern over the ongoing global conflicts, especially the crises in Niger, Sudan, and Libya, and called for their peaceful resolution through constructive dialogue and inclusive consultation. It urged the immediate cessation of hostilities in Sudan and supported the sovereignty, independence, territorial integrity, and national unity of Libya.
The most significant outcome of the summit was the decision to expand its membership to include six new members, namely Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE, with effect from January 2024. South Africa was the first country to benefit from its expansion ambitions when it was officially admitted in 2010.
The decision to include new members has also opened the door to future enlargement, as dozens more countries have voiced interest in joining the grouping. The enlargement move will increase the grouping’s envisaged role and influence as a geopolitical alternative to the West dominated global institutions.
The decision on the enlargement of BRICS was difficult to arrive at due to the conflicting views of the members on its desirability and criteria. Despite India’s initial reservations about the enlargement as it feared that the expanded group could become China’s mouthpiece with whom it has adversarial relations, Prime Minister Narendra Modi said at the summit that India “fully supports the expansion” of the BRICS group. Brazil has been the most sceptical of the BRICS enlargement as it is wary of alienating the West. The stands of India and Brazil were softened after the group agreed to the guiding principles, standards, criteria, and procedures for its expansion process.
Russia and China have been most vocal in championing the enlargement as they seek to boost their geopolitical interests at a time of tensions with the United States and the West. Russia sees it as a way of overcoming isolation over its invasion of Ukraine. Both see BRICS as a viable counterweight to the West.
The most remarkable achievement of BRICS is the establishment of the New Development Bank (NDB) in 2015 as an alternative to the International Monetary Fund and World Bank to fund infrastructure and sustainable development projects in BRICS and other emerging market economies and developing countries. Though the DNB has suffered massively from Western sanctions on Russia following its invasion of Ukraine, there is a plan to broaden the bank’s borrowing basket, and several countries in the Middle East and elsewhere in Asia are interested in contributing capital to the NDB.
In many previous meetings, BRICS members have raised the issue of reducing the dollar’s dominance in payments, prompted by continued weaponisation of the US dollar in the form of sanctions and trade wars and their desire for greater independence from the US-controlled financial system. The idea got accelerated after US interest-rate hikes and the soaring of the US currency after Russia’s invasion of Ukraine, along with the price hike of commodities priced in dollars.
With 88 per cent of international trade conducted in US dollars, the US enjoys a disproportionate edge over other economies. In order to reduce the overdependence on the dollar, consideration for a new, gold-backed common BRICS currency, which has been coined as R5 – referring to five currencies used by the current BRICS members – the Renminbi, Ruble, Rupee, Real, and Rand – is also on the long-term agenda of the grouping that will rival the US dollar as the global reserve standard. This would be something similar to the Euro.
Before implementing a common currency, BRICS members are planning to boost trade in local currencies. The Johannesburg Declaration underlined the importance of encouraging the use of local currencies in international trade and financial transactions between the BRICS as well as their trading partners. Many BRICS members have already begun to settle bilateral trade deals in local currencies. Brazil and China have already agreed to trade in their local currencies.
It must be noted that despite internal divisions, asymmetries, and even economic and security competition among member states, the grouping of five emerging economies has been trying not only to challenge the western dominated world order but also offer itself as an alternative voice of the global south and present a platform for cooperation for mutual development and seeking a more representative, fairer international order.
(The writer is a professor at Aligarh Muslim University and heads its Strategic and Security Studies Programme.)