BRICS Summit Wraps Up In South Africa & What Came Out of It
The annual BRICS Summit has wrapped up after a meeting from August 22 to 24 between the leaders of its five member countries. Although there was a notable absence, that didn’t stop the heads of state from convening and discussing possible plans for their collective future. Today, we’re looking into the BRICS alliance and what got considered at this conference.
The term was initially “BRIC,” which stood for Brazil, Russia, India, and China, while South Africa joined them later. That acronym got coined by economist Jim O’Neil, who was working for the Goldman Sachs Group at the time, in 2001. It stuck, and in 2009, it officially became the financial alliance we see today. With the goals of countering Western economic dominance and their system and possibly replacing the American dollar with their currency, the BRICS alliance have had some achievements since its establishment. Notably, the New Development Bank was founded in 2015, a multi-lateral development bank mobilizing resources for infrastructure and sustainable development projects in emerging developing countries and markets. And it recently held a summit in Johannesburg, South Africa, with Chinese President Xi Jinping also paying a state visit to the country. Despite the absence of Russian President Vladimir Putin due to the possibility of his arrest as ordered by the International Criminal Court, an important topic about the bloc’s future got discussed at the summit: The possible expansion of BRICS.
These matters concern the objective of BRICS, countering Western dominance, like the Group of 7 alliance. Tactics in achieving this include strengthening economic ties and increasing trade between members. And there is expansion, which will increase the global influence of BRICS. This movement, led by Russia (who wants more supporters for their war in Ukraine), has been supported by leaders from the other members. India initially thought rushing into expansion wouldn’t end well for the alliance, though its Prime Minister Narendra Modi has since voiced his support.
And that is how, following the 2023 BRICS Summit, the alliance announced the inception of six new members beginning in January of 2024. Those are, in no particular order, Argentina, Ethiopia, Iran, Egypt, the United Arab Emirates, and Saudi Arabia. These countries’ introduction into the alliance will also mean changing the acronym itself, and a possible name could be “BRICS+.” It is indeed a vast step for the bloc. However, another topic wasn’t as ideally resolved at the summit: “De-dollarization.” There were talks about how a new currency could counter the dollar, though that has been unsuccessful so far, with divergent statements from the heads of state on de-dollarization. The same economist who coined the term “BRIC,” Jim O’Neil, ridiculed the idea of a common currency, citing the political differences between China and India posed a significant obstacle to the goal. Until the next summit, the move for de-dollarization has more-or-less halted.
What is in store for the alliance? Well, and I should note here these predictions may turn out false, many experts believe that the economic power of BRICS is said to overtake the G7 in roughly 2050, with fast-developing countries like China and India fueling the rise of BRICS. Its combined financial strength, market potential, and resources could allow it to move away from relying on Western trade routes and developing south-to-south cooperation. With Chinese President Xi’s state visit to South Africa, he cemented the relationship between the two countries, further strengthening ties within the alliance.
However, there are hurdles in store for the BRICS alliance. One notable problem is despite all the achievements, BRICS is still an informal alliance and not as stable as the G7. It is ordinary for states to act in the interest of their own country and people, so it could be the case that, in the future, one of the BRICS members could change their mind about the alliance and opt for something that better suits their objectives, which could shake it from its core. Although that’s all speculative, and the actual situation will depend on the real-life situation, it is something to always keep in mind.
Do you have any other ideas about its future? Post your thoughts in the comments. That’s the end of this production from the New News Newsminute. Thank you for reading, and tune in next time for more news updates and in-depth analysis.