This year’s BRICS summit in Johannesburg, South Africa (held August 22-24), started with a noticeable absence of one of its leaders—Vladimir Putin. He was unable to attend because an arrest warrant issued by the International Criminal Court over war crimes in Ukraine would have obligated South Africa to take him into custody. Putin’s absence spoke greatly about his pariah status on the international stage. In his place, Putin sent his foreign minister, Sergey Lavrov, instead. Once the summit got underway, the economic group comprised of Brazil, Russia, India, China, and South Africa (hints the acronym BRICS) agreed to expand by allowing six new members—Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates. Both notable events at this year’s summit underscore a deep foundational weakness behind the economic alliance.
The BRICS alliance is an interesting club of nations. Politically and economically, there are more differences than likenesses. One finds both well-established democracies in the form of Brazil, India, and South Africa, yet one will also find communist China and authoritarian Russia leading the group. Two of its members, India and China, actively fight over a border dispute with the last flareup occurring in 2020 that left 24 soldiers dead. Economically, members range from the poor (India has the lowest GDP per person in the group), to the economic behemoth China has turned into whose economy is larger than the other four members combined. Some members, like Brazil and Russia, are net energy exporters, and others are dependent on imports. Most members do not like to intervene in their economies, but China artificially pegs its currency. Thus far the group of disparate nations has yet to find a common articulate voice.
However, this does not mean the group has no direction. At its heart, BRICS wants to be an alternative to existing economic blocs such as the G7 and G20. In 2014 BRICS established the Contingent Reserve Arrangement (CRA) as an alternative to the IMF (International Monetary Fund) to provide swap lines to central banks. These swap lines are designed to provide hard currency if there are ever balance-of-payments issues. To date the CRA has never been tested. The year after the CRA was created, BRICS established the New Development Fund (NDF) as an alternative to the World Bank. Since its establishment in 2015, the NDF has lent $33 billion to almost 100 projects. Access to NDF loans is not dependent on being a member of BRICS. While both financial institutions are still in their infancy, they are slowly growing, and the hope is that expanding BRICS into “Big BRICS” would strengthen and enlarge them even further.
The members pushing for expansion the most are China and Russia. They want to turn BRICS into an anti-American and less Western-centric club. For Russia particularly, it is an opportunity to offset Western blowback from its invasion of Ukraine. A larger group benefits China the most as it is able to extend its influence even more. The members the most against expansion are India and Brazil who joined the group primarily to gain better access to Chinese markets but do not want to jeopardize their relationships with the West. Both do not want to see the club becoming more China-Centric. South Africa does not want to lose its status in the club and instead prefers that any new joiners be treated as second-tier members with less clout. It is unclear if it got its way during negotiations over adding new members. President Cyril Ramaphosa of South Africa, said at the expansion announcement ceremony members had agreed on “guiding principles, standards, criteria and procedures” of the expansion process, but did not elaborate on what they were.
Currently there seems to be no immediate benefit to the club with the addition of new members. The list of new members is just as divergent and more heterogeneous than the original five members. Iran, for instance, is arguably even more of an international pariah than Russia. Argentina is facing serious economic hardships. And Ethiopia is incredibly poor. Yet countries that would seem beneficial to BRICS the most were not permitted membership. Indonesia’s application was rejected despite its population of nearly 300 million and being a powerful Asian influence.
Washington and its allies do not seem to be concerned over an expanding BRICS to their influence. Nor do they see BRICS as being a real geopolitical challenge. In a statement released by the White House after the BRICS expansion announcement, National Security Advisor Jake Sullivan touted the G20 as the “premier forum for economic cooperation,” that drives “an affirmative and ambitious agenda for developing and emerging countries.” The statement also highlighted the upcoming G20 summit in New Delhi and expressed “unified” support for India’s presidency of the G20 this year. BRICS was not mentioned in the release.
While the expansion of BRICS appears more symbolic than substantive for the immediate future, it does express a need for countries to have economic options. It is also indicative of changes in the calculus of nations after the geopolitical fallout from Russia’s invasion of Ukraine. This is especially the case in the Middle East where countries like Iran, Egypt, Saudi Arabia, and the United Arab Emirates have fundamental disagreements with the United States and want more flexibility with the economic partners they choose.
Zine Ghebouli, a visiting fellow with the Middle East and North Africa program at the European Council on Foreign Relations, told the Middle East Eye, “…Arab countries’ BRICS candidacy speaks much about a desire to rebalance ties with the overall West and seek alternative partners than just the relationship with the US… Arab countries are also sending a message to the Western world, which could mean rejection of certain development policies. However, the BRICS is unlikely to replace Western partners. The Western status in the Arab region is here to stay even if it is increasingly challenged.”
For the time being, BRICS is an ambiguous club with multiple and competing desires that allows various countries a sense of prestige they may not feel elsewhere. It remains to be seen if it coalesces into something more consequential and substantive.