China
Source: www.globaltimes.cn

With the 2023 BRICS summit set to be held in South Africa later this month, there have recently been some voices from Western media attempting to hype that divergences among members will impact the unity and development of the organization in the future, but these noises have been refuted by the relevant countries.

Chinese analysts said on Thursday that different opinions are very normal in an organization that upholds multilateralism and democratization of international relations, but if anyone tries to exaggerate the differences between members and downplay the significance of the BRICS cooperation mechanism, it only exposes the jealousy and nervousness of some Western elites, especially those who want to preserve US hegemony and a unipolar world order, when they see the unstoppable cooperation and development among non-Western countries or emerging economies.

Some Western media outlets, including Bloomberg and Reuters, have recently released reports frequently hyping some so-called problems of disunity among the BRICS members with the summit approaching. On Wednesday, Reuters reported that "Brazil has resisted gathering momentum in the BRICS group of major emerging economies to add more member countries, but debate over admission criteria seems inevitable at this month's summit," quoting "three Brazilian government officials" without giving their names.

However, Brazilian President Luiz Inacio Lula da Silva said on Wednesday that he has high expectations for the 15th BRICS Summit, which will be held in South Africa at the end of the month, noting it is "extremely important" that countries like Saudi Arabia, Argentina and other large developing countries join the bloc, the Xinhua News Agency reported.

Li Haidong, a professor at the China Foreign Affairs University, told the Global Times on Thursday that it's very normal to see different opinions within an international organization, and "we can see many arguments and even conflicts within NATO and the G7," while the US is always trying to keep its allies obedient or at least united by "provoking new threats" and "creating new enemies," and also "sharing US troubles with US allies." To some extent, the West is much more disunited than emerging economies.

Using rumors and groundless reports to exaggerate the differences among BRICS members only shows the mindset of some Western elites who wishfully hope that BRICS becomes paralyzed and falls into dysfunction caused by internal struggles, but even this kind of expectation is far from the facts, Li said.

In addition to Reuters, Bloomberg also published an article on Wednesday saying that BRICS "isn't big enough for both India and China," as it tried to say that tensions between the two countries "will likely prevent the BRICS bloc from ever posing a coherent challenge to the West."

India's Foreign Ministry spokesman Shri Arindam Bagchi has slammed 'baseless' speculation and untrue reports in some media that the country is against BRICS expansion.

"We have seen some baseless speculations...that India has reservations against [BRICS] expansion. This is simply not true," he said at a briefing on Thursday, responding to a TASS request to comment on the issue of the association's expansion.

Lin Minwang, a professor at the Institute of International Studies of Fudan University, told the Global Times on Thursday that although China and India have some disagreements, it's unrealistic and unfair to exaggerate their differences and say that China-India competition is hindering the development of BRICS.

"China and India are two major developing countries, so in many issues on development and the cooperation within the Global South, they share common interests, and this is why the BRICS mechanism has been able to develop successfully in recent years," Lin noted.

China and India both agree to push BRICS expansion, but, the two countries do have some differences on who should be included first.

However, this doesn't mean that their differences cannot be coordinated, Lin said, stressing that cooperation is the mainstream despite the existence of competition.

More importantly, apart from China and India, BRICS also includes Russia, South Africa and Brazil, so the future of the BRICS mechanism is decided by all members, not just one or two of them, as well as the emerging economies that want to join BRICS, so when analyzing the organization, exaggerating the differences between some members won't lead to an objective and credible conclusion, experts said.

South African Ambassador to China Siyabonga Cyprian Cwele told the Global Times in an exclusive interview in July, "Right from its inception, BRICS was never conceived as an exclusive club. It was pushing for inclusiveness, reform of global governance and financial institutions, a fairer multilateral system and strengthening multilateral governance under the UN system. We believe in expediting global trade other than protectionism."

"In terms of the surge in interest, a main element is that the benefits of being BRICS members are being seen by other developing and emerging economies. For instance, trade between BRICS members has increased, which then translated to direct benefits to the people with job opportunities and economic growth," said the ambassador of the host country of the BRICS summit this year.

Wang Yiwei, director of the Institute of International Affairs at the Renmin University of China, told the Global Times on Thursday that when they see the great potential of the BRICS mechanism, some Western countries, especially the US, "are trying to divide the world into three blocs - the US and the EU, China and Russia, and the Global South including India."

"With this kind of narrative, they can incite internal problems within non-Western countries and disrupt the cooperation among emerging economies. The BRICS members should not fall into this trap and stay united to jointly build a fairer and more reasonable globalization, and to solve those problems that the West failed or were unwilling to solve under the Western-dominated or America First international order," Wang said.

Li echoed this view, saying that BRICS will never play the game of bloc confrontation with the West, and even if BRICS does include more emerging economies in the future, they are not interested in challenging the G7 or other US-led organizations, as BRICS is trying to build a new globalization with inclusiveness and is open to mutual support and integration, and won't repeat the mistake made by the Western-led or US-led globalization that has caused increasing unfairness, uneven development and even chaos and turbulence worldwide.

Russia
Source: brics-plus-analytics.org

The nearing of the 2023 BRICS summit is expectedly generating all sorts of controversies around which candidate economies are to accede to the BRICS core or form a "circle of friends" of the grouping. The revelations of the past several weeks that there are divisions within the BRICS around the issue of the expansion are not all that sensational – in the past 5-6 years the theme of BRICS expansion has generated divisions and concerns from some of the core members[1]. The important point, however, is that there is much that may be done within the framework of a flexible multimodal BRICS+ framework to accommodate the desire of a rising circle of developing economies to build ties with the BRICS bloc – and this opportunity should not be wasted during this year's BRICS summit in South Africa.

In the academic world, the scenarios associated with the choice between expanding core membership and BRICS+ were explored in a Valdai club report in 2022 – the conclusion was that in some respects BRICS+ modalities may appear to be superior to an outright expansion in the BRICS core membership[2]. As rightly pointed out by Andrew Korybko[3], in view of the concerns expressed by some of the BRICS members about the expansion in the core, "BRICS+ could be a mutually beneficial compromise". And it is a compromise that has a notable degree of optionality built into it. After all, some of the possible tracks of BRICS+ as a multimodal platform for economic cooperation may include:

• Expansion in the membership of the New Development Bank
• Expansion in the "circle of friends" that are regular participants in BRICS/BRICS+ summits
• Construction of a BEAMS platform that would bring together all of the main regional integration arrangements of the BRICS economies

China that is the most active proponent of the expansion in the BRICS core is known for its long-term horizons and strategic planning – in this respect, in pushing for BRICS expansion it will need to keep in mind several longer term risks, most notably the increasing complexity of the attainment of consensus as well as the accumulation of frictions with members such as Brazil and India that have reservations regarding such a development route for the BRICS. Rather than attempting to secure the ultimate solution through a "big bang" BRICS expansion, a far more "Chinese/long-term" strategy would allow for the BRICS+ framework to accept a growing number of partners, with such a platform serving as a lab of innovation and exploration of the multitude of possible pathways to economic cooperation.

In terms of the realistic scenarios of the expansion in the BRICS as I have mentioned in the "BRICS+ Analytics" blogs earlier, "at this stage there appear to be two regions of the Global South that are yet to find their place within the BRICS core – these regions are the Middle East and South-East Asia. The largest economies coming from these regions that are also members of the G20 are Saudi Arabia and Indonesia – they are also the largest representatives of the respective regional blocks – GCC and ASEAN. Such a limited expansion to include two more developing economies would essentially allow the BRICS to cover all of the main sub-regions of the Global South, including the main regional integration blocks of the developing world"[4].

The inclusion of Indonesia and Saudi Arabia into the BRICS core would bring the total number of BRICS members to seven – on par with the G7 block. And while G7 is essentially built on the hierarchical principle of the largest developed economies forming the group, the BRICS7 is inherently more horizontal as the main principle will then reside in the representation of the main regions of the Global South. The incorporation of Saudi Arabia and Indonesia apart from bringing in representatives from all of the main regions of the developing world would also add to the BRICS core the key energy player in the world economy as well as one of the largest developing economies in the world by population and GDP in the coming decades[5]. The main counter-argument against such a BRICS7 formation is that it further tilts the balance of core membership in favour of Asia, something that may be to a degree attenuated via greater scope to be provided to Latin America and Africa in various BRICS+ modalities, including in the BRICS-led BEAMS platform of regional integration blocks.

In the end, one thing is certain – this year's summit will be a watershed event for the BRICS and the global economy as the somewhat ossified status-quo gives way to what is likely to be a significantly more inclusive, open and variegated partnership. At the end of the day, it is not that critical whether several more economies enter into the BRICS core or form part of the enlarged BRICS+ – what is crucial is that the circle of BRICS partners is expanding with important implications for the evolution of the global economy. What we are witnessing now is a tectonic shift in the world economy – a free choice of the developing world to create new partnerships and economic platforms such as BRICS+ that will direct global economic development towards a more balanced and equitable trajectory.

[1] In 2019 Brazil discontinued the BRICS+ format, something that was followed by India and Russia in 2020-2021.

[2] Arapova, Ekaterina and Lissovolik, Yaroslav, BRICS: the Global South Responds to New Challenges (In the Context of China's BRICS Chairmanship) (July 13, 2022). Available at SSRN: https://ssrn.com/abstract=4301141 or http://dx.doi.org/10.2139/ssrn.4301141

[3] https://korybko.substack.com/p/explaining-chinas-and-indias-reported

[4] https://brics-plus-analytics.org/the-brics-expansion-dilemma-size-vs-representation/

[5] A somewhat more tangential issue is that the addition of these two countries does not necessitate a change in the BRICS abbreviation and the currencies of these two economies also start with an «R» – as in the case of all of the BRICS5 core economies.

Image: Geralt via Pixabay

Greece
Source: moderndiplomacy.eu

In January 2023, Russia's assertion regarding the deteriorating relations with the United States had far-reaching consequences, particularly concerning their participation in the International Space Station (ISS) program. Moscow's stated intention to withdraw from the ISS by 2024 has engendered significant uncertainties, posing serious questions about the future continuity of space cooperation between these two nations. This situation has added complexities and challenges to the international space domain. This marked the end of a 25-year forum of space cooperation between the two nations. However, in the BRICS meeting in Hermanus, Moscow offered BRICS members-Brazil, Russia, India, China, and South Africa the chance to participate in the construction of a joint module for its planned orbital space station. Many critics suggest that the growing partnership between Moscow and Beijing in outer-space poses challenge for the west. However, this article contends that the growing partnership between Moscow and Beijing in space exploration should not be seen as a challenge for the West but rather as a wake-up call for a more inclusive and peaceful approach to outer space, free from historical power struggles. By promoting collaboration among diverse nations, BRICS can pave the way for a more democratic system in space, while addressing concerns about potential militarization and other environmental issues in space.

The Cold War space competition between the United States and the Soviet Union initiated the trend of having space capabilities to project political power. The launch of Sputnik by the Soviet Union in 1957 caused alarm in Washington and led to the establishment of the National Aeronautics and Space Administration (NASA) in 1958, intended to rival Soviet achievements. In 1961, the Soviet Union made a record in history by sending Yuri Gagarin, the first man to enter Earth's orbit. Subsequently, the triumph of the Apollo program, with Neil Armstrong becoming the first man on the moon, solidified the US's position as the space exploration leader. During this period, space exploration remained largely confined to the two superpowers, leaving developing nations with limited involvement due to significant financial barriers and technical advancement.

The formation of BRICS was driven by a desire to create a more democratic financial and monetary system, reducing dependency on the US and European developed countries. In 2021, BRICS countries took a significant step towards collaboration by launching a cooperation committee to share remote sensing satellite and data. Now Russia's call for BRICS members to participate in the construction of a joint module for its planned orbital space station. Undoubtedly, the Russia-Ukrainian war has emerged as a significant determinant in Moscow's decision to withdraw from the International Space Station (ISS), which had been one of the last remaining channels of cooperation between Russia and the United States. Russia's plans for the future involve the launch of the first stage of their planned space station, known as the Russian orbital system, which is anticipated to take place in 2027. This development further underscores the complexities surrounding the evolving dynamics in space exploration and raises important questions about the future landscape of international space cooperation.

Critics argue that Russia-China space cooperation poses a threat to national security. However, China's aggressive advancements in space have disrupted the traditional hegemony of NASA, emphasizing the need for inclusive participation. In the article "U.S. Military Transformation and Weapons in Space" written by Everett C. Dolman mentioned that "No nation relies on space more than the United States." It is essential to recognize that NASA's historical exploits may not have been transparent to other nations, thus necessitating a new era of collaboration and shared knowledge. While the Russia-Ukraine conflict has influenced Moscow's decision to withdraw from the ISS, BRICS' partnership on the Russian orbital system presents an opportunity for greater collaboration in space. By leveraging the strengths of each member nation, BRICS can serve as a driving force to address complex issues such as space militarization and promote peaceful space exploration. For example: country like India which is known for cost-effective space programs can play a pivotal role in enabling other countries to participate in space exploration with shared values. Furthermore, BRICS serves as a forum through which China's assertive space ambitions can potentially be moderated by fostering the development of appropriate space policies and collective goals.

In light of the growing concern over the militarization of outer space, the current international space treaty appears insufficient to adequately address future risks.

As the world faces critical challenges like climate change, inequality, war, international cooperation is paramount to resolve complex problems in space. Relying solely on individual nations to explore and utilize outer space may lead to fragmented efforts and exacerbate geopolitical tensions. While acknowledging that engagement with Moscow and Beijing poses certain challenges for member nations, embracing multilateralism in space through BRICS represents a hopeful avenue.

Considering the ever-changing geopolitics and power dynamics between the major world powers, it is can be surmised that the nature of war in outer-space will be inherently complex.

The collapse of the Russia-U.S. space corporation and Moscow's withdrawal from the ISS underscore the need for a new approach to space exploration. BRICS offers a unique opportunity to foster multilateralism in outer space, decoupling it from space completion and promoting cooperation among diverse nations. By adhering to principles of non-discriminatory access and shared values, BRICS can lead the way to utilize space exploration for collective goods while mitigating concerns about space militarization. Embracing international cooperation, we can collectively address the challenges and opportunities that lie beyond our planet and ensure a peaceful and prosperous future for all of humanity. By building bridges among nations and promoting peaceful exploration, BRICS can revolutionize outer space cooperation for the benefit of all mankind. Moreover, Russian future space station might offer an opportunity to move beyond reliance on the American umbrella and foster a new system of multilateralism in space, thereby narrowing the gap between Western nations and the rest of the world.

Russia
Source: tass.com

"This is a very important topic because we see that increasingly more countries are making statements about their intention to join this group," Dmitry Peskov added

The topic of expanding BRICS (Brazil, Russia, India, China, South Africa) is "near the top of the agenda" and will be discussed at the upcoming BRICS summit, although nuances exist among the group's member states regarding its expansion prospects, Kremlin Spokesman Dmitry Peskov told reporters.

"Indeed, the topic of BRICS' expansion is near the top of the agenda, including the agenda of the upcoming summit. This is a very important topic because we see that increasingly more countries are making statements about their intention to join this group. Indeed, within the framework of BRICS certain nuances exist among members on the subject of expansion, and all these nuances certainly will be discussed during the upcoming summit," he said, commenting on a report by Bloomberg, citing sources, that India and Brazil are purportedly resisting China's calls for a rapid expansion of BRICS.

The Kremlin official added that BRICS expansion-related issues will be determined during the summit, as "the heads of state will talk about their position." "Overall, such a [high level of] interest in the BRICS group is indicative of the association's great potential and growing authority, and, most importantly, of the hands-on nature of the group," he concluded.

It is expected that the BRICS summit slated to be held in Johannesburg, South Africa, on August 22-24 will review official applications submitted by a number of candidate countries to join the group.

Russia
Source: tass.com

Delcy Rodriguez emphasized that Venezuela is ready to offer "the world's biggest oil deposits to the service of the BRICS energy commission"

CARACAS, August 4. /TASS/. Venezuelan Executive Vice President Delcy Rodriguez said her country had filed an official request to join the BRICS group of nations, bringing together Brazil, Russia, India, China and South Africa.

"Venezulan President Nicolas Maduro has made the official announcement about the bid to join BRICS, and the Foreign Ministry has sent a corresponding request," Rodriguez told Venezolana de Television in New Delhi, where she is participating in the work of a council, bringing together India, Latin American and Caribbean nations.

The vice president emphasized that Venezuela is ready to offer "the world's biggest oil deposits to the service of the BRICS energy commission." The country will assist the development of "new relations of cooperation" and "the creation of a new multipolar world."

In her words, Venezuela is "at the forefront of the process to create international relations free of hegemony, blackmail and unilateral restrictive measures that blatantly violate the international law."


"The people of Venezuela demand that illegal sanctions [against their country] be lifted," she added.

"The world where one decaying country is pretending to rule the planet and give orders to other nations has no right to exist. This world [order] is done for," the Venezuelan vice president continued, adding that her country is "building a new multipolar world" together with BRICS.

The BRICS summit, to be held in Johannesburg on August 22-24, is expected to review official bids to join the group from a number of countries.

TAGS

Russia
Source: infobrics.org

Ahmed Adel, Cairo-based geopolitics and political economy researcher

The growing favouritism towards central bank digital currencies, such as the Russian digital ruble, launched on August 1, is underpinned by the great potential to create a new, non-Western-centric global monetary system. After Russian President Vladimir Putin signed the law enshrining the legal provisions of the digital ruble, it became the third form of Russian national currency, along with printed banknotes and bank cards, marking another step in Moscow overcoming its expulsion from the SWIFT financial transaction processing system and de-Dollarizing its economy.

Central bank digital currencies (CBDCs) have many advantages over other cryptocurrencies while lacking drawbacks, such as the speed and low costs of the transactions, which has a commission of only 0.3%. Unlike unregulated cryptocurrencies, a CBDC operates entirely within the established financial system. It also serves as another method for Russia to circumvent Western sanctions as it is not only a step towards simplifying business transactions within Russia but also in the long term internationally.

Although the US dollar will continue being the de facto currency of international trade in the short and medium term, the interconnectivity of new cryptocurrencies represents another step toward de-Dollarisation and a blow to the Western-dominated financial system. Russia is not the only country activating CBDCs, as other BRICS members are also actively developing similar currencies. In fact, Moscow had already proposed the creation of a single digital currency for Russia, China, and India to reduce dependence on the dollar or the euro, as well as the possible impact of current or planned international sanctions on these fiat currencies.

On the agenda at the BRICS summit in South Africa later this month is how members of the organisation are developing CBDCs, as well as the expected benefits of digital currencies in international trade and finance and their forecast. This is essential because until the BRICS countries unite their national CBDCs into a harmonised platform, they are unlikely to change the dollar's role in the market significantly.

Russian banks were banned from using the Brussels-based SWIFT following the launch of the special military operation in February 2022, forcing Moscow to find alternative methods to conduct international business. Instead of Russia becoming financially ruined, the global hegemony of the US currency is breaking down, something which will deal a heavy blow to those who have pinned their hopes on the US, such as Ukraine and NATO's Eastern European member states.

The dollar has dominated since the imposition of the Bretton Woods regime in 1944. However, the global economy is no longer subject to hegemony, and a new multi-currency economic order is taking shape. This occurs partly because the US uses its financial power to try and subjugate countries such as Russia.

Weaponising the dollar has actually eroded its status as an internationally valid currency. The US policy of turning dollar use into an exclusive club is destroying its status as it should, in theory, function as a universal good.

More countries are interested in trading in local currencies, most recently, Iran and Indonesia. Sixty countries, such as India, currently trade in their national currencies instead of the dollar, which has trade agreements with 19 countries to trade in its own currency. Russia, for its part, has adopted the yuan as its unit of payment in trade with China, which is expected to exceed $200 billion by the end of 2023.

According to the latest data from the Bank of Russia, the yuan's share in the country's trade rose from 4% in January 2022 to 23% by the end of the same year. According to a Bloomberg report, the yuan replaced the dollar as the most traded currency in Russia in terms of monthly trading volume for the first time in February 2023.

It is not just about using local currencies, in any case. Many countries choose to conduct their trade using exchanges from various currencies, such as the Chinese yuan, Indian rupee and Russian ruble. Take, for example, Bangladesh, which has agreed to pay for imports from Russia in the Chinese yuan. At the same time, Saudi Arabia has also begun to accept yuan payments for its oil exports.

Oil was traditionally only traded in dollars, but trading in the yuan is evidently on an upward trend. This de-Dollarization strategy is already causing the percentage of reserves held in US dollars globally to decline steadily. According to Bloomberg, the percentage of the dollar held in foreign exchange reserves fell from 73% in 2001 to 58% in 2023. In 2022 alone, the rate of decline of the dollar's share of foreign reserves was 8%, according to Bloomberg calculations.

Efforts to create a new international currency to replace the dollar are gaining momentum. The BRICS Summit on August 22-24 could pave the way for using a new currency to facilitate trade among BRICS members, representing 41% of the world's population and 31.5% of the world's goods and services.

Russia
Source: en.interaffairs.ru

The world economy is in transition. The global balance of power is shifting due to the war in Ukraine and Western sanctions against Russia and other countries. The BRICS confederation, which includes the developing countries of Brazil, Russia, India, China and South Africa, seen as the pioneer of an economic system that is an alternative to the US dollar-dominated financial system, writes 'The Berliner Zeitung'. The correspondent of this German newspaper spoke about the prospects for the BRICS and the growing influence of China with an expert and consultant on global economic relations, Dr. Dan Steinbock.

Here are some scores from that interview:

- I do not think that the goal of BRICS is to find a replacement for the dollar. Rather, it is about the diversification of the monetary system, which would be consistent with today's global economy.

- The vision of the world by the BRICS countries is of key importance for many newly industrialized and developing states. BRICS is also open to large Western economies if they are willing to share with him his vision of a more integrative and fair world order.

- At the moment, about 20 countries would like to join the BRICS, another 20 are thinking about it.

- Negotiations within the BRICS have intensified since 2008 as the financial crisis in the West led to instability and the United States even more actively began to use the dollar as a weapon to advance its interests.

– The main advantage of the alternative financial system will be a greater diversification of the monetary system. During the Great Recession of 2008/09, Zhōu Xiǎochuān, head of the People's Bank of China, urged Western economies to reform the international monetary system. Numerous promises were made in Brussels, Washington, and Tokyo, but nothing went beyond them. Therefore, efforts have been made towards the creation of supporting development institutions such as the New Development Bank, the Asian Infrastructure Investment Bank, China's New Silk Road Initiative and plans for a new foreign exchange regulation.

- Most of the economies of the BRICS countries are still largely dependent on the dollar, while the states that fell under the sanctions of the US and its allies have severely reduced their reserves of dollars and decided to replace them with gold.

- What the major economies of the BRICS countries want is a deeply diversified global monetary system. If the current system is not corrected for some time, then it will be radically transformed by a large-scale global crisis.

- Recently US Treasury Secretary Janet Yellen said that there is no alternative to a currency system based on the dollar. However, not so long ago, she warned against a catastrophic scenario if Washington does not agree on a new ceiling on the national debt. Today, the United States still accounts for a quarter of the world's GDP, but it is also on the verge of its capabilities and completely mired in debt.

- It is useful to recall that the British, until 1914, constantly talked about the superiority of the pound. However, its dominance ended with the overstretching of the British economy after 1945.

– The crisis of 2008 came after two decades of economic growth and globalization in the West. Today's catastrophic situation is the result of more than a decade of missed opportunities and deglobalization. No country in such a chaotic situation is able to provide enough global momentum. However, the latest data on Chinese trade show its growing regionalization and South-South cooperation. In the first half of this year, the Association of Southeast Asian Nations (ASEAN) became China's biggest trading partner, with trade between them up 5.4% year-over-year. In the same period, China's trade with the EU increased by 1.9%. It is especially important that China's trade with countries and regions along the "New Silk Road" in the first half of the year increased by 9.8% compared to 2022. Over time, these new mechanisms, including the Asian free trade agreement RCEP, will open up great opportunities not only for China, the BRICS and their partners, but also for Europe, Japan and the United States.

- China's recent actions in the Middle East and some other regions and countries are indicative of the potential that the country can acquire for future peace efforts. Since the days of Deng Xiǎopíng and his reformers, China's highest goal has been economic development. But without peace and stability, no development is possible.

Russia
Source: en.interaffairs.ru

Belt and Road is China's version of globalization. Belt and Road came at the end of a distinct period in modern economic history – the age of hyper-globalisation, writes Wolfgang Münchau, a former co-editor of Financial Times Deutschland and director of Eurointelligence.

This period started with the cessation of the Cold War and ended with the pandemic. Its first decade was mostly about trade liberalisation: the World Trade Organisation became the new global trade authority. Countless trade deals followed. The 1990s were also the decade of the internet and of financial deregulation. In Europe, it saw the introduction of the single market, and set the stage for the enlargement of the EU in the subsequent decade.

But the most consequential change of all was the integration of China into the global economy. China supplied the world economy with cheap labour. Germany, China and other Asian countries were the workshops of that system. They ran large and persistent trade surpluses against the rest of the world. The US and the UK were the system's bankers. Global imbalances were not a bug of the economic system, but a feature.

Globalisation was not primarily about the trade in goods. The share of goods trade increased rapidly in the 1990s and early 2000s, peaked around the time of the global financial crisis in 2008, and has stagnated since. What distinguished the period from 1989 onwards was the globalisation of other factors: capital and labour. Freedom of movement in the enlarged EU brought to western Europe the "Polish plumber" and the "Lithuanian waiter". Trade is not what our modern era of globalisation is about. It is about people.

Globalisation was a win-win game for the world economy at an aggregate level. What the supporters of globalisation did not see, or did not want to see, were the rising numbers of losers: in the Rust Belt of the US, in northern England, northern Italy, northern France and eastern Germany. Donald Trump's America First campaign in 2016 was a reaction against globalisation. So was Brexit. Each country has become unhappy in its own distinct way. But what they have in common is a fall in political support for the old system.

In the EU, which often follows global trends with a delay, the worst is still to come.

The US and the EU have imposed economic sanctions on Russia, so far with only modest success. The US and some European countries have excluded Huawei, the Chinese mobile telephone company, from building 5G mobile communication systems. The most far-reaching restriction of all is the US ban on the sale of high-performance semiconductors to China.

The US did this ostensibly to stop China developing high-precision missiles, but it was also to protect America's own technological leadership in this sector.

The global political and economic consequences of this enormous policy reversal have not been fully understood. One of them is a new global division, with Russia and China once again on the other side of an Iron Curtain.

It's not just Russia and China. The five countries known as the Brics – Brazil, Russia, India, China and South Africa – used to be seen as the emerging tiger economies of the 21st century. They were supposed to be on the side of the American-led West. But not one of them is complying with those expectations any more. One side effect of Western sanctions over Ukraine has been that China's trade with Russia hit an all-time record last year.

The five Brics countries have set themselves the goal of becoming less dependent on the US, but they have not quite figured out how to achieve this. China and Russia have both worked on creating payment systems to make each other less reliant on the US and Europe for transactions. The world of crypto-currencies and blockchains has opened up still unexplored opportunities to bypass Western financial monopolies. The Brics have been discussing a joint reserve currency. That would be a big deal…

China would have to undertake a huge economic policy shift away from investment towards domestic consumption. That won't be easy. It would mean depriving powerful provincial party chiefs from funds and diverting those funds to consumers. The upshot of such a policy shift, though, would be a reduced vulnerability to US sanctions.

The Brics are also working on strengthening the New Development Bank (NDB), which provides finance to its five founding states. Four other countries have since joined the NDB: Bangladesh, Egypt, the UAE and Uruguay. It could take a decade or two before the Brics develop a coherent economic union, a counterweight to the West. Until then, the US will continue to enjoy the exorbitant privilege that arises from the dollar's global role. But I wouldn't bet on this still being the case in 2040.

There are also signs of a revolt against the Biden administration's China strategy from Europe: the pushback against the pushback. Olaf Scholz, the German chancellor, presents China both as a strategic competitor in some areas, such as car production, and a partner in others, such as climate protection. On 13 July, the German government announced its China strategy, which emphasised both competition and cooperation. The economic interdependence between the countries on the Eurasian continent is still strong. Should there ever be a military conflict between the US and China over Taiwan, I struggle to see Germany siding with the US. Germany wants to trade with both.

There are good reasons for the age of hyper-globalisation coming to an end. But we should be under no illusion about the economic costs of de-risking, such as chronic labour shortages and inflation. Hyper-globalisation pushed prices down. De-risking pushes them back up again. Climate change imposes huge costs on governments and the private sector. It is unclear whether voters are willing to pay the price for this.

The period of globalisation was an era of plenty – for some. During that time, central banks and governments were able to support their economies almost without limits. De-risking brings back old policy constraints, Wolfgang Münchau concludes.

Russia
Source: mid.ru

Friends,

I am happy to welcome participants in the 3rd BRICS International Youth Camp, organised in the Ulyanovsk Region with the support of the regional officials and the Federal Agency for Youth Affairs.

The camp is acknowledged as a popular and dynamically developing platform for cooperation between ambitious young people representing many professional areas. The forum makes a substantial contribution to expanding full-scale strategic partnership within BRICS, strengthening friendship, trust and mutual understanding between our peoples.

The younger generation's active involvement in our common work clearly indicates the appeal of the very concept of BRICS. Cooperation within the five is a remarkable example of modern multilateral diplomacy. We have neither leaders nor followers; all decisions are based on consensus and a careful and fair balance of interests. We view this association as one of the pillars of the more just multipolar architecture of the world order that is taking shape today.

Friends,

This year, aspiring journalists, IT professionals and graphic designers will gather at the camp for a training programme and a lively exchange of opinions.

The central theme of the event, the media industry, sounds quite relevant. With the increase in geopolitical tensions and the dominance of fake news and content in the Western media, it is particularly important to boost efforts against digital totalitarianism and promote the objective image of BRICS in the global media environment.

I am confident that this forum will be instrumental in achieving these goals and its extensive prorgamme will give participants an excellent opportunity to learn new things and establish mutually beneficial contacts. Certainly, they will learn more about the unique cultural and historical legacy of our multiethnic and multifaith country.

I wish you an enjoyable time, interesting encounters, new friendships and all the best.

Russia
Source: mid.ru

The III BRICS International Youth Camp is underway in the Ulyanovsk Region from August 1 to 6. Its central theme is the media sphere. Foreign Minister Sergey Lavrov is scheduled to deliver a video address at the official opening ceremony today.

Young journalists, professionals in the field of information and communication technologies, and graphic design specialists from the five BRICS countries will discuss the implementation of joint projects and train in working as a team. We hope that this event will make a substantial contribution to building up trust and mutual understanding among the BRICS nations.

The active involvement of young people in our common efforts is graphic proof of the attractiveness of the idea and concept of the five-nation group, which has become a pillar of the evolving structure of a fairer multipolar world order.

Russia traditionally pays special attention to the development of various kinds of relations between the group's counties. This year, Russia will host a series of events from the group's humanitarian basket. Many meetings, including youth events, have been planned for next year when Russia will take over BRICS chairmanship.