25 August 2023 12:01 am Views - 697
(From L to R) Chinese President Xi Jinping, Brazil’s President Luiz Inacio Lula da Silva, South African President Cyril Ramaphosa and India’s Prime Minister India Narendra Modi gesture during yesterday’s BRICS Summit session at the Sandton Convention Centre in Johannesburg. Russian President Vladimir Putin took part in the summit through a video link. (Photo by Marco Longari/AFP)
Is the BRICS, a group of five emerging economies, falling apart or strengthening its position as a potential challenger to the G7, the Western-led alliance of the world’s most developed
Leaders of the BRICS nations—Brazil, Russia, India, China, and South Africa—wound up their 15th summit yesterday in Johannesburg, South Africa, however, indicating that they had resolved to make BRICS stronger and more meaningful so that it could wield greater clout in shaping the world. In other words, they stressed that they wanted to be counted in deciding the fate of the global economy.
BRICS has still not reached a level that warrants comparison with the G7—comprising the United States, the United Kingdom, Germany, France, Japan, Italy, and Canada— which has arrogated itself the right to decide on world affairs. Yet BRICS’ economic indicators paint a seated colossus capable of towering over the G7 if it stands up.
This is because the BRICS contribute more to global GDP in purchasing power parity (PPP) terms than the G7. The International Monetary Fund predicts that China and India alone will account for about half of global growth this year. The BRICS countries also account for 40 percent of the world’s population and a quarter of the global economy.
However, some analysts say BRICS has a long way to go to catch up with the G7. They say the G7 nations still have a higher per capita income, a bigger capacity for technological innovation, and wield more military power and political clout than the BRICS countries. They also point out that the G7 is politically more united than the politically diverse BRICS. Besides, G7 countries also share common values and interests, such as democracy, human rights, and free trade, while BRICS countries are a disparate mix of big and small economies and democratic and authoritarian states. Yet BRICS nations share a collective desire to challenge the Western-led global order, which they say does not serve their interests.
The West is not oblivious to the rise of the BRICS. Although the US and its allies believe that the different political ideologies within BRICS will prevent it from becoming a unified bloc, they will not allow BRICS to undermine their global clout.
The presence of China in BRICS is what makes the West jittery. Already, Western hegemony, as epitomised by the G7 and the North Atlantic Treaty Organisation (NATO), has been challenged by China and Russia, both BRICS members.
For the West, however, India’s presence in BRICS may offer assurance that the grouping will not grow anti-West. This is probably one of the reasons why India is invited to G7 summits. But the West is also cognizant of the fact that India charts an independent foreign policy, always doing what serves India’s national interest best, regardless of its obligations to the West. The day India sees that its national interest will be better served by improving political and military ties with China than with the West, it will indeed be a paradigm shift in world politics. In politics, nothing can be ruled out.
Political disunity is an obstacle BRICS needs to overcome if it is to emerge as a leader on the global scene, like the G7.
These concerns aside, as many as 24 emerging economies are knocking on BRICS’ door for membership. They include Saudi Arabia, Turkey, Iran, the United Arab Emirates, Argentina, Indonesia, Egypt, and Ethiopia. These countries believe that by becoming BRICS members, they too can have a say in bringing about a global order that upholds economic justice. Of course, they will also benefit from BRICS partnerships, such as the Shanghai-based multilateral New Development Bank.
Yesterday, BRICS leaders agreed to expand the club after an initial disagreement that saw Brazil oppose the enlargement, China and Russia push for it, and India and South Africa sit on the fence. Accordingly, Argentina, Ethiopia, Iran, Saudi Arabia, Egypt, and the United Arab Emirates will become full members from January 1.
China, which represents about 70 percent of BRICS’ total GDP, sees an enlarged BRICS as compatible with its Belt-and-Road Initiative (BRI), with which it has made inroads into the world’s strategic ports and trade hubs. It also feels that BRICS is the right type of forum to challenge US hegemony.
Addressing the BRICS summit on Wednesday, Chinese President Xi Jinping said that expanding the bloc would “pool our strength and pool our wisdom to make global governance more just and equitable.”
“Development is an inalienable right of all countries, not a privilege of a few,” he said.
What of India? India has spurned China’s invitation to join the BRI due to its suspicion that China’s objective is not only trade but also military expansionism. India views China as a hostile power following border clashes in the Ladakh region in 2020 and China’s suspicious activities in the Indian Ocean. However, China remains India’s largest trading partner, with trade between the two reaching a record US$136 billion last year.
India is a member of the pro-Western and China-focused Quadrilateral Security Alliance, which also includes the US, Japan, and Australia. But India also maintains friendly ties with the West’s chief antagonist -- Russia. It buys Russian arms and refuses to condemn Russia’s invasion of Ukraine. India, along with China, is also one of the biggest buyers of Russia’s sanctions-slapped petroleum products.
India’s Prime Minister Narendra Modi, who was in a jubilant mood on Wednesday after India made history by becoming the first nation to land a craft on the moon’s south pole, told the summit he supported opening the door to new members and “welcomes moving forward with consensus”.
If BRICS expands with the inclusion of new members, in what way will it be different from the G20, another global platform for economic cooperation and discussing global issues such as climate change? The G20 includes all seven G7 countries and all five BRICS nations. India will host the G20 summit in October. Unlike the G20, which is largely a talking shop, BRICS is work-focused.
It has set up the multilateral New Development Bank, which offers its members unconditional development aid, unlike the IMF, whose assistance is extended under tough conditions. BRICS is also focusing on a new reserve currency to bypass the US dollar, as the de-dollarisation of international trade is one of its objectives. The matter was discussed in Johannesburg, but a decision was deferred until the complexities were sorted out. BRICS nations, meanwhile, carry out trade in their local currencies through the BRICS Interbank Cooperation Mechanism and the digital payment platform BRICS Pay.
These measures make BRICS relevant. In the global south, BRICS is being seen as a beacon for developing countries, just like the Non-Aligned Movement, which championed their cause from 1961 to the early 1990s before becoming defunct.