BRICS and the Political Economy of the New World Order
The BRICS countries are asserting themselves in global politics, aiming for greater representation and influence. They have the potential to drive global economic growth and innovation, particularly through investments in education and emerging technologies. The development of a consolidated and constructive global governance model and potential trade using a common currency could further enhance their global influence and solidify their position as a powerful force in global leadership, writes Nivedita Das Kundu.
Introduction
The BRICS (Brazil, Russia, India, China, South Africa) alliance is reshaping the world order by shifting power from the “Global North” to the “Global South”. Originally coined by Jim O’Neill in 2001 as BRIC, the acronym was expanded in 2010 to include South Africa, becoming BRICS. This group of nations represents almost half of the world’s population and boasts a combined GDP contribution of 31.5%, surpassing that of the G7 (30.7%).
BRICS has become a significant forum for addressing critical global issues such as trade, finance, climate change, and energy security. Its impact extends beyond discussions to shaping the global economic landscape. In 2014, the member nations launched the New Development Bank (NDB) with $50 billion in initial capital. The NDB serves as an alternative to the World Bank and the International Monetary Fund, providing funding for infrastructure and sustainable development projects.
Additionally, the BRICS nations established the Contingent Reserve Arrangement (CRA), a liquidity mechanism designed to support member countries facing payment difficulties. These initiatives demonstrate the BRICS nations’ intention to create institutions that represent the interests of emerging economies and provide an alternative to existing global financial institutions.
One of the strengths of BRICS is its potential to assist poorer countries without pursuing any political agenda or indirectly manipulating local economies. The NDB and the Asian Infrastructure Investment Bank (AIIB) are more reflective of the priorities and interests of emerging economies.
The 15th BRICS Summit is scheduled to take place in South Africa from August 22-24, 2023. The summit will be hosted at the Sandton Convention Centre in Johannesburg, Gauteng. This gathering of BRICS leaders will provide an opportunity for further discussions and collaboration on various issues of importance to the member nations and the broader global community.
Political Economy
The past two decades have witnessed significant political and economic transformations within the BRICS countries, which have influenced their regional dynamics. These nations have embarked on ambitious infrastructure projects, reflecting their respective visions for smart and sustainable development. For instance, China’s Belt and Road Initiative aims to establish extensive infrastructure networks connecting Asia, Europe, and Africa. India has planned the development of 100 smart cities linked by bullet trains, while Russia seeks to build up the Russian Far East as a new economic bridge between Europe and Asia through Advanced Special Economic Zones. Brazil and South Africa have focused on large-scale farming and industrial expansion.
To support infrastructure projects globally, new multilateral financial institutions have emerged, including the Silk Road Fund, the BRICS New Development Bank (NDB), and the Asian Infrastructure Investment Bank (AIIB). These institutions aim to raise additional liquidity for infrastructure development worldwide, offering alternatives to traditional financial mechanisms.
Furthermore, the ’Global South’ has taken steps to introduce alternatives to the dollar-based trading system. China and Brazil, for example, have agreed to engage in cross-border trade using their own currencies, bypassing the dollar system. The ASEAN nations have also called for alternatives to dollar-based trading. Moreover, countries like Russia and India have engaged in trade using their own currencies, and India and Bangladesh are in the process of doing the same.
These developments highlight the efforts of the BRICS countries and other nations in the Global South to establish more diversified and independent trading systems. By promoting trade in local currencies, they aim to reduce reliance on the dollar and enhance economic autonomy.
Overall, the BRICS countries’ political and economic transformations, as well as their initiatives for infrastructure development and alternative trading systems, demonstrate their aspirations for smart, sustainable development while reshaping the global economic order.
New World Order
The BRICS countries are increasingly asserting themselves on the global political stage, particularly in areas such as international negotiations, peacekeeping, and conflict resolution efforts. It is important to understand that the BRICS countries are not aiming to replace the West; rather, they seek to achieve greater representation and influence in global affairs. The BRICS alliance advocates for a more equitable and inclusive global economic and political system.
One of the key areas where BRICS can make a significant impact is through joint investments in education, research and development, as well as in the sharing of knowledge and expertise. By leveraging their collective strengths, the BRICS countries have the potential to drive the transition to a more sustainable and equitable global economy. Their investments in emerging technologies such as artificial intelligence, blockchain, and renewable energy can position them as major drivers of global economic growth and innovation in the near future.
Moreover, the BRICS countries are working towards developing a new global model of governance that is consolidated and constructive, rather than unipolar. If the BRICS countries reach an agreement to conduct trade using a common currency, it could accelerate the process of de-dollarization. This move would not only enhance the BRICS countries’ global influence but also establish them as a powerful force in global leadership. It is projected that by 2030, the BRICS countries, with their proposed enlargement, could contribute over 50% of global GDP, which would further solidify their significance on the global stage.
In summary, the BRICS countries are asserting themselves in global politics, aiming for greater representation and influence. They have the potential to drive global economic growth and innovation, particularly through investments in education and emerging technologies. The development of a consolidated and constructive global governance model and potential trade using a common currency could further enhance their global influence and solidify their position as a powerful force in global leadership.
The Way Forward
The success of BRICS has generated significant interest from other nations, including the United Arab Emirates (UAE), Saudi Arabia, Argentina, Algeria, and Mexico, to invest in this bloc. Algeria, Argentina, and Iran have already submitted applications to join BRICS, while Saudi Arabia, Turkey, and Egypt have expressed their keen interest in becoming members and are currently engaged in the membership process. The inclusion of these countries in BRICS would have a profound impact on the global economy and the world order.
BRICS countries are advocating for reforms in multiple global institutions, arguing that they are currently under-represented. They emphasize the need to address the structure of the United Nations, shareholdings in the World Bank and International Monetary Fund (IMF), and membership and renewal processes to strengthen global organizations such as the World Trade Organization (WTO) and World Health Organization (WHO). By pushing for these reforms, BRICS aims to create a more inclusive and equitable global order.
BRICS at a Historical Turning Point: Unexpected Challenges
Expectations about the role of the BRICS in world affairs are shaped independently of the will of the participants in this group: they become the product of the evolution of the entire international order in a direction whose main features we have yet to witness, writes Valdai Club Programme Director Timofei Bordachev.
The BRICS group (Brazil, Russia, India, China, South Africa) was created in conditions where the universal power of the West had already entered a period of slow decline, but few had any doubts that the United States and Europe would be able to determine the main characteristics of the world economy and international politics for a long time. Globalisation and the system of international institutions created with their vigorous participation were still coping, on the whole, with their tasks, and there were not enough obvious prerequisites and reasons for their landslide collapse. In fact, it was globalisation and the international institutions created by the West that determined the “packaging” of the international order, centred around the wealth accumulated over several centuries and the military and political capabilities of its founders.
The main systemic characteristic of BRICS is that it is a community of revisionists, i. e. powers that did not set as their goal the destruction of the world order, but sought to achieve the inclusion of their interests in this order. All its participants were able to extricate themselves from their previous plight thanks to the opportunities that the unjust international order led by the West gave them. All of them grew at the expense of resources, although they were dramatically curtailed in the realisation of their basic interests and values. Finally, none of the BRICS countries has plans to forcibly change the existing order of things, as revolutionary France, Germany and Japan have tried to do at one point or another over the past 250 years.
However, as contradictions accumulated in the world, even the modest revisionist wishes of the BRICS members became a factor that is leading, if not to the destruction of the existing international order, then to its most fundamental restructuring. Accordingly, the expectations regarding the BRICS countries are being shaped by their main partners, as well as opponents to their rise. Many countries throughout the world are now looking at the BRICS as a group that can, if not pick up the banner of global governance from the West, then at least become its second pillar; one that is more just and less selfish in relation to the small and medium-sized states of the world. In other words, expectations about the role of the BRICS in world affairs are shaped independently of the will of the participants in this group: they become the product of the evolution of the entire international order in a direction whose main features we have yet to witness.
The most striking manifestation of such hopes is the numerous ideas about expanding the BRICS by including new states. A list of countries has already been formed — candidates for joining the group, some of which look like real heavyweights. But in order to move forward in understanding how the BRICS’ contribution to new global governance can truly be decisive, we need to ask ourselves a few questions. First, can the BRICS group maintain internal unity in an era when even the strongest international partnerships are being severely challenged? Second, is it possible in the current circumstances for the BRICS to maintain the revisionist nature of their behaviour in relation to the order that was created with their minimal participation and, in part, at the expense of their interests?
No one can doubt that the decisive influence of the BRICS in the shaping of the main aspects of the global agenda will make the world more just and stable. Russia, which assumes the chairmanship of the group in 2024, can set this as one of its main general political goals. Such a contribution is virtually inevitable, simply because the BRICS countries are not parasitic powers whose success and achievements depend on the ability to get the rest of the world to serve their interests. Their economic opportunities and political influence aren’t grounded in a history of bloody wars, conducted with the purpose of establishing regional and global dominance. On the contrary, it was through wars — within itself and with those around it — that the modern community of Western countries, has created “its own” international order.
However, in order to fully realize the BRICS mission, this association will very likely have to answer the aforementioned questions, regarding its own destiny. We cannot ignore the fact that all the experience of strong institutions and global governance is the experience of the West, i.e. a community united by common values and, most importantly, interests in relation to the surrounding world. This is what allows them to stick together and be relatively effective in opposing the rest of humanity. Only forceful dictate of the US against its main allies would not be enough. It certainly plays an important role, but it cannot be the only fundamental factor. In the centre are the interests and values that led to the situation of the impossibility of any serious internal conflicts among the countries of the West.
Unlike the US and Europe, the BRICS community is not based on the idea of exploiting other countries and regions. The political systems of its members do not come from a single source, as is certainly the case of Europe and the United States. Moreover, the different civilizational foundations of the BRICS countries directly prevent them from creating an association whose internal discipline would be comparable to the West. Therefore, any observer can now question the ability of the BRICS to set the world agenda in the same way as the G7 countries have been doing for decades. The BRICS members may yet have to figure out how they can respond to the expectations of the international community, which has come to expect the dictatorship of the West and the patronage of Brazil, Russia, India, China and South Africa. The BRICS are already establishing concrete ways of contributing to the formation of the agenda for the whole world, and there are obvious achievements. However, as the ability of the United States and Europe to indicate the direction of movement to everyone collapses, the demand for clear support from the BRICS will only increase.
This means that the member countries of the group may, theoretically, face some challenges to their unity. Forming an alternative agenda to the dictates of the West is one thing, but creating ways to solve global development and security problems for the whole world, or at least for the countries of the World Majority, may turn out to be a more difficult task. In the near future, the BRICS may be required to be able to offer others new tools to address their core development problems, which means that the group’s degree of unity on key issues will need to go beyond weighty political statements.
An equally serious issue may be the preservation of the nature of the BRICS as a community aimed not at destroying the existing world order, but at improving it for the better. This is what makes it revisionist, and not revolutionary in terms of the intentions of the participating countries and the tasks that they set for themselves. The BRICS countries do not want the collapse of globalisation, institutions and international law. This means that their task is more complex: to create within the existing order such rules, norms and ways of cooperation that would allow for the preservation of its advantages and the elimination of its shortcomings. That revision, and not revolution, is the goal of the BRICS countries, the basis for the sustainability of this association and its relations with other countries of the World Majority. Preserving this nature is completely within the interests of the BRICS member countries and the entire international community. The alternative can only be a split in the group and the continuation of the power of that narrow group of countries, to counteract whose egoism the BRICS was created.
INTERNATIONALIST 360° 