Russia
Source: tass.com

BRICS can change world order, evolve into G7 counterpart — expert

The expert reiterated that more than 40 countries worldwide have already signaled their interest to join BRICS or to cooperate with the organization, bringing together Brazil, Russia, India, China and South Africa

HONG KONG, August 13. /TASS/. BRICS countries have the potential to change the existing world order and turn their union into a counterpart of G7 on the global arena, journalist Anthony Rowley wrote in his opinion piece, published by South China Morning Post.

The expert reiterated that more than 40 countries worldwide have already signaled their interest to join BRICS or to cooperate with the organization, bringing together Brazil, Russia, India, China and South Africa.

In his opinion, the bloc is building greater influence in reform of the international economic and financial system and in securing a bigger voice and vote for developing nations at the International Monetary Fund. In his opinion, the potential attraction of BRICS lies in the fact that it is becoming "a balancing force in world affairs."

According to non-resident senior fellow at the Atlantic Council Hung Tran, BRICS "could evolve to become a counterpart to the Group of Seven (G7) in world affairs, resulting in a profound impact on international relations."


At present, the organization continues to build greater influence on the global arena despite the existing differences between two of its members, China and India.

The article names BRICS New Development Bank as an example of it. The bank has already financed 98 projects worth $33.2 billion in total. The author emphasizes that the NDB will aim to provide 30% of its financing in local currencies of member countries, which is consistent with the aim of reducing dependence upon the dollar, reflecting the common goal shared by China and India.

The BRICS summit will take place on August 22-24 in Johannesburg and will be chaired by South Africa. According to South Africa's Minister of International Relations and Cooperation Naledi Pandor, at the summit the leaders of the BRICS countries will discuss possible expansion of the organization. According to her, 23 countries, including Iran, filed formal applications for joining the association.

The BRICS group was formed in 2006. Initially, it included four countries - Brazil, Russia, India and China. South Africa joined the association in 2011.

Russia
Source: en.interaffairs.ru

Reuters carried a speculative report last week that Indian Prime Minister Narendra Modi might not attend the BRICS summit in Johannesburg in person and, furthermore, that India disfavoured an expansion of the grouping. Reuters' long history of cold war skulduggery notwithstanding, the gullible Indian media fell for the rumour mongering. And it created some confusion, but only momentarily, notes M.K. Bhadrakumar, Indian Ambassador and prominent international observer.

South Africa is conscious that with the state of play in its bilateral ties with the US being what it is, President Cyril Rampaphosa's excellent personal equations with Russian President Vladimir Putin, BRICS' sojourn on the ''de-dollarisation'' pathway and its expansion plans, there are high expectations of Modi's constructive role to make the upcoming event in Johannesburg a historic milestone in 21st century world politics.

The plain speak by the South African foreign minister Naledi Pandor on the Reuters report is spot on. Pandor said, "I did speak to various colleagues in government and outside, and everybody was astounded by this rumour. I think that someone who is trying to spoil our summit is creating all sorts of stories that suggest that it won't be successful.

"The prime minister of India has never said that he is not attending the summit. I am in constant contact with foreign minister Jaishankar. He has never said that. Our sherpas are in touch and they have never said it. So, we have all been trying to look for this needle in a haystack that began this rumour."

There was a time not too long ago when the West used to ridicule the BRICS as an ineffectual butterfly beating its wings in the void in a world order dominated by the G7. But the ''butterfly effect'' is being felt today in the remaking of the world order.

Simply put, the torrential flow of events in the past year in the situation around Ukraine brought to the surface Russia's existential struggle vis-a-vis the US, which in turn triggered a tectonic shift in the international landscape, one transformative aspect being the rise of the Global South and its increasingly important role in international politics.

The Biden administration wouldn't have expected that a polarisation to isolate Russia and China would end up like this. Paradoxically, Washington's ''dual containment'' of Russia and China, as enshrined in the Biden Administration's National Security Strategy marked the beginning of the Global South breaking away from the control of the big powers, repositioning their international status and role, and seeking strategic self-confidence and autonomy.

Saudi Arabia is a stellar example — assuming an independent trajectory in regional hot spots such as Sudan or Syria, calibrating the world oil market through the OPEC Plus format rather than obey the diktats from Washington, and in seeking BRICS membership.

The developing countries are gaining room to manoeuvre in the game of big powers and their political influence has risen rapidly. Their diplomatic independence and strategic autonomy against the backdrop of the Ukraine crisis has accelerated their rise as an emerging force in global politics in a remarkably short period of time.

What prompts the 23 non-western countries to formally seek BRICS membership — although, the grouping doesn't even have a secretariat — is because the grouping is perceived today as the principal platform of the Global South espousing an equitable world order and, therefore, has a tryst with the destiny of mankind.

Right from its inception, BRICS has been savvy enough not to inject any ''anti-westernism'' into its agenda — in fact, none of its founding members has a ''bloc mentality''. But that hasn't prevented the West from feeling threatened. In reality, this threat perception emanates out of a morbid fear of extinction that the 4-century old western dominance of the political and economic order and the international system is drawing to a close.

Neo-mercantilism, which is crucial to arrest the decline of the western economies, is being frontally challenged, as we are witnessing in real time in Niger. Without the massive transfer of resources from Africa, the West faces a dim future. The European Union's foreign policy chief Josep Borrell blurted out in a weak moment that the West, a manicured garden, is threatened by the jungle. The atavistic fears and instincts implicit in Borrell's metaphor are simply stunning.

Hence such frenzy to run down BRICS, to weaken its resolve, to tarnish its image and standing, and prevent it from gathering momentum. Alas, the same old colonial ''divide and rule'' mindset is at work to amplify the differences and disagreements between the BRICS member states.

As regards the canard that Modi planned to skip the trip to Johannesburg, Indian spokesman reacted, ''I would urge you not to go by speculative media reports. When we are in a position to talk about, to announce such high-level visits, we will certainly do so, and you'll know that that's been our practice. For the moment, I would urge you all to just be patient and let us announce it at the right time.''

Equally, the Anglo-American conspiracy behind the ICC's arrest warrant on Putin is self-evident. Russia had pioneered BRIC and the grouping's first summit took place in Yekaterinburg in 2008 [which, by the way, issued a joint statement warning against the global domination of the US dollar as the world's standard reserve currency.]

Putin has been tirelessly campaigning for ''de-dollarisation'' and is the most resonant voice today on that issue on the international stage. Putin's prognosis has gained wide acceptance in the Global South, as evident from the exodus of countries opting for national currencies to settle their mutual payments. Washington is increasingly concerned that a process of 'de-dollarisation' is gaining traction in the international financial system following its excessive weaponisation of sanctions and arbitrary seizure of dollar reserves of countries it does not get along with.

Interestingly, Bloomberg featured an article on the BRICS summit titled ''This club isn't big enough for both China and India.'' Its thesis is that ''tensions between the Asian rivals will likely prevent the BRICS bloc from ever posing a coherent challenge to the West.'' It is a hackneyed attempt to dwell on the contradictions that exist between China and India to drive a wedge and undermine BRICS unity.

True, India may have concerns about China dominating BRICS group. But then, China is also a strong exponent of BRICS expansion and increased representation of developing countries. Doesn't that show a strategic convergence?

Fundamentally, despite their unresolved border dispute, India and China have a common vision that BRICS plays an essential role on the global multilateral stage. Both countries also see the BRICS as a platform to enhance their international status and influence. This commonality of interests is what worries the West.

For India, BRICS is a favourable instrumental platform to realise its aspiration to achieve greater representation on the international stage. Therefore, BRICS success can only strengthen India's foreign policy — and, conceivably, may even create some positive energy and ambience in its relations with China, M.K. Bhadrakumar concludes.

Greece
Source: moderndiplomacy.eu

BRICS is a formal alliance of Brazil, Russia, India, China, and South Africa. Its upcoming Summit is scheduled to be held on 22-24 August in Johannesburg, South Arica. BRICS host South Africa has invited 69 countries to attend the upcoming summit. The invitation has been sent to all African heads of nations and the Global South bodies.

As the end of the Summit approaches, the world's attention is turning toward South Africa, where the BRICS Summit is set to take place. The forthcoming summit holds significant implications for global geopolitics, with its central agenda revolving around the launch of a common currency among the BRICS nations. This move, aimed at reducing the dominance of the US Dollar in international trade, has the potential to reshape the geopolitical landscape and challenge American supremacy. While Russia, China, South Africa, and Brazil are actively advocating for this shift, India's reluctance and undeclared stance add complexity to the discussions.

The Geopolitical Significance

For decades, the US Dollar has reigned supreme in global trade and transactions, affording the United States unparalleled economic and geopolitical leverage. The US has been using Dollar and economy as tools to coerce and pressurize its adversaries. Imposing sanctions was a common tool against its rivals to achieve political goals. Usually, developing countries were the victims. There has been a growing sentiment against the US hegemony, supremacy, and coercion. In the past several countries or leaders took a stand against the American Hegemony of US Dollar domination. But, as an individual leader or a country, the US snubbed them, the worst victims were Iraq, Libya, and a few nations in South America and Latin America. The proposed launch of a BRICS common currency or de-dollarization aims to alter this status quo, potentially diminishing the American influence and power that is closely tied to the Dollar's dominance. BRICS is a strong Alliance and plays a huge role in Global Trade and Investments, and above all, it is above American influence. It seems. BRICS is in a position to transform the global economy in total. This move represents a growing discontent with the U.S. dollar's global dominance and a push toward Eastern superiority.

Russian Stance

Russian officials have been vocal in their support for the BRICS common currency initiative. Sergey Lavrov, Russia's Foreign Minister, stated, "The BRICS nations possess substantial economic strength. It is only logical that we explore alternatives to the Dollar-dominated global financial system. A common currency could enhance economic cooperation among our nations and contribute to a more balanced world order."

Chinese Stance

China, as a major global economic player, has also thrown its weight behind the common currency initiative. President Xi Jinping emphasized, "The BRICS nations must pool their resources to challenge the existing financial architecture. We have the economic prowess to establish an alternative currency that will foster multi-polarity in the global economy and curtail unilateral dominance." China as a single country has a significant share in the global economy and possesses the potential to challenge any hegemony, but, wanted to move unitedly along with BRICS and other nations. China is a country with the largest foreign exchange reserves (Dollars).

Brazilian Stance

Brazil, too, stands in favor of exploring alternatives to the Dollar-centric financial system. Brazilian President, Jair Bolsonaro, expressed, "Our partnership within BRICS offers an opportunity to challenge the existing norms that disproportionately favor a single currency. A common currency could bolster economic cooperation and ensure a fairer representation of our collective strength."

South African Position

The South African Ambassador revealed exclusively to Watcher Guru, that BRICS will discuss the use of native currencies for cross-border transactions. Sooklal indicated that a decision to ditch the U.S. dollar for global trade could be taken at the upcoming summit.

Indian Stance

India's stance on the common currency initiative has been marked by caution. Indian Prime Minister Narendra Modi articulated, "While the idea of a BRICS common currency is intriguing, we must thoroughly evaluate its implications for our economy. Any such move should prioritize our national interests and stability." Indian stance is an illusion and deliberate to sabotage the agenda of BRICS for the upcoming Summit. It is worth mentioning that, India is following an irrational approach in its foreign policy. As India is hostile to all its immediate neighbors, regional alliances like SCO and BRI, whereas, trying to be close with the US and its alliances like Quade, etc. As a matter of fact, India is a misfit in this region and spoiled its relations with all its neighbors including Bangladesh, Bhutan, China, Maldives, Myanmar, Pakistan and Sri Lanka, Nepal. It has created a very tense environment in the entire region and posed as a serious security threat to all these countries. It has been playing a dirty role in SCO and BRI. Now trying to create problems and divide in BRICS.

Expansion and New Members Expected

Forty-four countries have shown interest in joining the BRICS alliance, with 22 formally applying. It is expected that Saudi Arabia, the UAE, and Argentina are rumored to be the first inductees. Many other nations will follow soon, once this trend is initiated.

Again, India is creating hurdles in inducting new members, especially opposing any country like Iran which adversary to the US. It seems, the Indian role in the BRICS is to protect American interests and takes dictation from Washington. Once India is exposed, it might lose its membership in SCO, BRICS and etc.

The upcoming BRICS Summit in South Africa holds the promise of significant geopolitical changes. The initiative to launch a common currency among BRICS nations represents a bold move to challenge the longstanding dominance of the US Dollar. As Russia, China, South Africa, and Brazil advocate for this shift, India's illusive approach yet undisclosed stance contributes to the complexity of discussions. The outcome of the summit could mark the beginning of a new era in global finance and geopolitics, with potential ramifications for the existing world order.

Russia
Source: infobrics.org


Karolina Koval, Fudan University (China), Institute of Ethnology and Anthropology (Russian Academy of Sciences) - special for InfoBRICS

Interview with Ashley Otu, Founder and researcher at IDCOOP ashleyotu@gmail.com

- Ashley, tell us please, what are the prospects for cooperation between Russia and Africa? Could you name the most profitable areas for partnership?

- I believe the areas of increased co-operation between Russia and African nations are in the areas of agriculture, energy, security, education and health

- What problems and challenges are there? Western countries are putting pressure on Africa not to cooperate with Russia there. What advantages does Russia have?

- The problems and challenges which Russia faces, regarding increasing co-operation in Africa is logistical, financial infrastructure and cultural. Some Western nations have the advantage of dominating certain nations economically and culturally. Now, the advantages that Russia has unlike Western nations is historically, Russia was never involved in colonialising in Africa and during the cold war, contributed to a number of African nations gaining independence from former western colonial powers.

- What positive aspects of the Russia-Africa Forum memorandum can you mention?

- The positive aspects of the recent Russia-Africa Forum were 4 joint declarations signed between Russia and all heads of states, including the head of the African Union. Moreover, Russia planning to increase the number of embassies in nations, where since the 1990s, was closed down. Furthermore, Russia announced it will provide grain for free after its withdrawal from the failing grain deal, where Africa was provided with little to no grain. In addition, Russia announced it would write off a total of $23 billion in debt obligations.

- Russia will continue grain supplies to the African continent. Actually, in 3-4 months, free grain will be sent to Africa. Are there any stumbling blocks to resolve this issue?

- The potential stumbling blocks to Russia's ability to deliver grain is logistics, considering the risks of undersea drone attacks in the Black Sea by the Ukraine forces. The way to overcome this is potential setback is to increase the transit of grain via the North-South Transport Corridor to have a secure route to facilitate deliveries to Africa.

- A number of countries on the African continent are preparing to join the BRICS and prefer to cooperate not with Europe and the United States, but with Russia, China and their allies. What is the reason for this?

- The main reasons why BRICS looks attractive for the number of African nations wanting to join is economics. Especially, as each nation has undergone the same or similar experience of development (neo-liberalism and its disastrous effects). BRICS has surpassed the G7 in terms of total GDP value and wealth. The group members never interfere with a nation's internal affairs. Especially, as certain western nations which have historically and to this day, continue to openly sponsor colour revolutions to topple governments, and force controversial policies on nations which don't abide by their demands. The emergence of new multilateral institutions such as the BRICS new development bank and AIIB (Asian Investment Infrastructure Bank), provides a new source of funding to support key projects in African nations and breaks the monopoly of financial loaning from the World Bank and in the worst-case scenario, the I.M.F. Each member of the BRICS has played a key role in supporting the interests of African nations at other multilateral institutions such as the G20, supporting the application of the African Union to become a member.

- How could we improve interaction in the cultural sphere? Frankly speaking, cultural exchange is the basis of prosperous relations between peoples?

- I believe Russia must increase its cultural exchanges in education, sports, art and media. As these kind of exchanges are necessary to understand what makes it nation unique and areas of cooperation. When I was younger, I was always told that Russians were racist, growing up in England. Once I began watching some Russian films and did a university class on Russian contemporary cinema, my interest and appreciation of the nation and its people grew. Every May the 9, I always watch the victory parade of Russia's victory during The Great Patriotic War (1941-1945) and honouring the lives sacrificed. So, I believe cultural exchanges is necessary to overcome any negative stereotypes and biases which have being promoted through certain western soft power (films, TV, religion, music, arts, NGOs and language programmes) in Africa.

- What is BRICS for you and who are you in this union?

- For me, the BRICS group of nations, provide alternative economic development models for other developing nations to pursue, instead of the failed neo-liberal policies which continue to be promoted by western nations despite the failed promises of neo-liberalist policies in a number of regions (Latin America, Africa, South Asia and Eastern Europe). Where I am in this union is, I am part of the African diaspora. Having been born and raised in the United Kingdom, I have grown and learnt how and why western hegemony has been nothing but a bad outcome for everyone, whether you are born in your homeland or born abroad, and the treatment is the same. I believe with the emergence of the multipolar world and the end of western hegemony, I believe the outcome will be better for everyone. Especially, as the majority of global growth will be generated from emerging economies in the global south and mainly members of the BRICS. Demonstrating the best development policies are pursued by state-led capitalism and not leaving the fate of the nation to the free market (the invisible hand).

Greece
Source: moderndiplomacy.eu

As of late Tuesday evening, August 8, 2023, countries expressing their intent to join BRICS account for 60% of known global oil/gas reserves. At the very least, this means 60 percent of the worlds oil sales will take place in a currency OTHER THAN the U.S. Dollar, once BRICS brings their new, gold-backed currency to life, claims Harold Turner, Halturner Radio Show, North Bergen, New Jersey.

The official announcement surrounding the development of this new currency is scheduled to be made on August 22. The currency is not created yet and is not available yet.

But this change will come like a lightning bolt out of the blue for the Untied States.

As things are right now, ALL oil sales around the world, are done only in U.S. Dollars. So every country that needs oil, or which sells oil, conducts those transactions only in DOLLARS.

That means every country on the planet needs to hold physical dollars in its central bank, so that the country can buy the oil/gas it needs.

Once the new BRICS currency comes online, all those excess DOLLARS being held all over the world, will start to come back tot he United States.

Thus, the value of OUR currency will drop against all those other currencies, because nobody will want or need our DOLLARS anymore.

Now, bear in mind, the US does not manufacture much of anything anymore. We import all our stuff.

So as the value of our DOLLAR falls against foreign currencies, the cost of the things we buy will utterly skyrocket because our currency is worth less and less compared to other country's currencies.

We will see hyper-inflation here in the USA that I suspect could rival the Weimar Republic just before it collapsed.

As of tonight, these are the countries that intend to join BRICS:

• Algeria
• Argentina
• Bangladesh
• Bahrain
• Belarus
• Bolivia
• Venezuela
• Vietnam
• Guinea
• Greece
• Honduras
• Egypt
• Indonesia
• Iran
• Cuba
• Kuwait
• Morocco
• Mexico
• Nigeria
• UAE
• Tajikistan
• Thailand
• Tunisia
• Turkey
• Syria
• Saudi Arabia
• Ethiopia

Once this gets done, and oil sales begin in the new BRICS currency, the United States will economically collapse and nothing can stop it.

I smell a world war coming… – Harold Turner feels.

Russia
Source: tass.com

UAE's accession to BRICS to push West towards recognizing new world order — expert

UAE is described to have strong economy and "very good GDP in general and GDP per capita," offering BRICS many opportunities, especially regarding energy

DUBAI, August 9. /TASS/. Granting the United Arab Emirates the status of a member of BRICS group (Brazil, Russia, India, China, South Africa) will allow the association to push Western countries towards accepting changes in the system of international relations, especially with regard to trade and de-dollarization, Mohamed Badine El Yattioui, Doctor of Political Science, Assistant Professor of International Affairs and Strategy in the College of Security and Global Studies at the American University in the UAE has told TASS.

"The role of the BRICS has been increasing during the last years and the last decade," said El Yattioui. He believes that the countries of the community "are trying to establish a new paradigm in international relations" and bring about a new world order.

"For the United Arab Emirates, it's important to become part of the BRICS group," the scholar said. He added that the admission of the UAE and other BRICS candidates will help the group "push the western countries towards accepting some modifications of the new world order, especially those regarding international trade, international political economy in general, currency and leaving the dollar."

"Saudi Arabia and the UAE have strong economies and very good GDP in general and GDP per capita and they are offering BRICS many opportunities, especially regarding energy," Al Yattioui noted. "The UAE are very good candidates for BRICS and it is in the interest of BRICS to have them inside the group," the scholar said.


On June 1, the BRICS foreign ministers at a meeting in Cape Town in southwestern South Africa considered the concept of the group's expansion, but decided to send the document for revision. The next day, a Friends of BRICS meeting was held. It was attended by the foreign ministers of the BRICS member-countries and 12 other states of the Global South that expressed their wish to join the community.

The South Africa-chaired BRICS summit will be held in Johannesburg on August 22-24. According to the country's Minister of International Relations and Cooperation, Naledi Pandor, the BRICS leaders will discuss the expansion of the organization. By now 23 countries have submitted formal admission applications.

TAGS

Russia
Source: brics-plus-analytics.org

BRICS expansion is set to become the main topic of discussion at the BRICS summit in South Africa and as with so many actively discussed matters there is enormous confusion about what this expansion actually means. Is it just about the expansion in the BRICS core membership or a BRICS+ format? In the latter case, does the BRICS+ format amount to simply adding the BRICS candidate countries into a "group of friends of the BRICS" or could there be various categories of members with observer status or with a permanent right to participate in BRICS summits. And is there scope for the developed economies to become part of the expanding BRICS platform? While the summit is to decide on the short-term exigencies of the expansion process, the reality is that most of the above formats could well be accommodated within the various modalities of BRICS outreach to the economies of the developing and developed world.

One possible mode of expansion is the widening of the circle of developing economies forming the BRICS core. Starting from 2022 this track of BRICS expansion has been prioritized by China, with a high probability of new members being admitted to the core during the 2023 BRICS summit in South Africa. There have been numerous proposals concerning the country composition of the next waves of BRICS core expansion – from including most of the developing economies that are members of the G20 to incorporating two economies (Indonesia and Saudi Arabia) that play a key role in their respective regions. Further rounds of core expansion, however, will likely be constrained by the rising difficulties of arriving at a consensus and the reservations on expansion coming from some of the founding BRICS members.

The other possible modality for expansion is BRICS+ – a format launched by China in 2017 and reserved for the building of economic ties with partners from the Global South. Together with the outreach activities conducted by South Africa in 2023 there were altogether four BRICS+ outreach undertakings – two conducted by China and two more by South Africa. In the span of the 7 years since the first BRICS+ summit in China, the scale of these outreach formats has grown substantially – something that played a major role in triggering a wave of applications to join BRICS from other parts of the Global South. But the importance of BRICS+ role for the developing world may not be in the sheer number of countries that are joining the block, but rather in a structure that this format may accord to the rising impulses of South-South cooperation. Some of the structured foundations of BRICS+ may include:

• A platform for the regional trade arrangements of developing economies
• A platform for the regional development institutions (regional development banks and regional financing arrangements)
• A platform for the sovereign wealth funds of developing economies

There may be numerous other BRICS+ formats/platforms, including a grouping of "observers" as well as regular participants at the annual BRICS summits. The multiplicity of these and other possible platforms of South-South economic cooperation can all come under the umbrella of BRICS+ cooperation. The benefit of such a format is that it relieves in part the pressures from other economies to expand the BRICS core, while providing both structure and flexibility/optionality to expanding economic cooperation with the Global South.

The third trajectory for BRICS expansion could be a BRICS++ format that has not yet been implemented and remains largely a theoretical possibility. The BRICS++ proposal advanced in 2017-2018 was to extend the economic cooperation between BRICS/BRICS+ with advanced economies and their development institutions[1]. In effect, the BRICS++ framework allows the BRICS outreach to embrace the entire world economy and create a platform for a renewed globalization effort. Importantly, however, this would be a globalization with a different starting point, a different foundation and a different technology of implementation. It would represent a platform that is complementary to G20 and that would base globalization impulses on the set of values and priorities advanced by the Global South, most notably:

• "no core, no periphery" development paradigm
• scope for divergence in economic models pursued by various countries and regional blocks
• Alternatives and optionality in the key elements of the global financial system, including alternative reserve currencies and payment systems
• Depoliticization of conditionality and avoidance of politicized trade restrictions
• Greater weight in international organizations accorded to developing economies in line with their share in the world economy
• Greater role for the United Nations and its economic institutions within the framework of international economic cooperation
• Prioritization of international economic assistance in areas ranging from technology transfers to fighting pandemics to be granted to least developed countries (LDCs)

In effect BRICS++ may be the platform for a revitalized globalization effort to be carried out with due regard to the role and weight of developing economies. This was precisely the vision of an "alternative globalization" that was formulated back in 2017-2018 with a particular role envisaged for a BRICS-induced momentum to economic openness and cooperation[2]. And this may be not the only vision of globalization that is likely to emerge in the coming years as a rising number of countries and regions are likely to advance their visions and platforms[3]. The hope is that from this rising number of "globalization ideologies" a convergence of visions[4] will provide scope for cooperation between the BRICS++ framework and the competing projects from the advanced world[5]. The latter scenario would be greatly facilitated if there would be greater connectivity in the BRICS++ framework/BRICS+ summits with the IMF, World Bank, WTO, NDB, BRICS CRA as well as the regional development institutions from the Global South and the developed world.

Overall, within BRICS different members may lead or prioritize the pursuit of the various tracks of the block's expansion. In particular, China is likely to prioritize the expansion of the BRICS core as well as BRICS+ as the platform for the Global South. Russia may opt for the "integration of integrations" track of the BRICS+ platform, a format that may be also favoured by South Africa that will continue to seek formats that will bring the African continent into closer proximity with the BRICS block. India and Brazil may accord greater importance to the BRICS++ format that will explore the possibilities of building ties between the BRICS-related platforms of the Global South and those of the developed world. And the advancement of the BRICS++ framework will make it more difficult to level unsubstantiated claims that BRICS is an anti-Western/confrontational club, while providing scope for neutral countries as well as West-leaning economies to become part of such an inclusive platform.

At the end of the day, what seems quite clear is that an open, extrovert BRICS is far superior compared to an introvert and narrowly self-interested grouping. The BRICS+ and the BRICS++ formats offer a greater promise and potential than the mere expansion in BRICS core membership. The enthusiasm of the Global South about joining the expanding BRICS block should not overshadow the pressing need to forge ahead with pragmatic cooperative platforms and financial mechanisms that will result in a material improvement in the welfare and poverty reduction across the developing world. In this respect, BRICS has the potential and the capabilities to create not only the conditions for a more structured economic integration in the Global South, but also for a revitalized globalization drive that is more balanced and sustainable compared to earlier patterns.

[1] https://news.cgtn.com/news/3d3d514d3459444d79457a6333566d54/share_p.html

[2] Lissovolik, Y. (2018, January 21). BRICS-plus: Alternative globalization in the making? World Economic Forum. https://www.weforum.org/agenda/2018/01/brics-plus-analternative-to-globalization-in-the-making

[3] Lissovolik, Y. (2019, February 28). The clash of globalizations: the next frontier in international competition. Valdai club. https://valdaiclub.com/a/highlights/the-clash-of-globalizations-the-next-frontier/

[4] The convergence that did not come about during the Cold War period, with adverse implications for global security and development.

[5] In the connectivity track signs of such competition are observed between BRI, the Global Gateway and B3W.



Image: Geralt via Pixabay

Russia
Source: brics-plus-analytics.org

This year the focus on the BRICS summit may finally reach a point when it is going to be followed closely not just by the BRICS scholars, but by the wider global community, including the global financial markets. The reason is simply that the BRICS agenda centered on the block's expansion as well as the possible introduction of a new reserve currency is becoming material to the ongoing changes in the architecture of the world economy. Going forward, in case the BRICS continues to move towards a more pragmatic economic framework the market relevance of BRICS summits may become more significant, particularly with respect to EM market dynamics.

Thus far, academic research into the market relevance of the annual summits of national leaders in key global fora such as the G20 suggests that they do not appear to matter to markets that much. One of the analytical forays in this sphere undertaken by the European Central Bank (ECB) concludes: "Our main finding is that G20 summits have not had a strong, consistent and durable effect on any of the markets that we consider, suggesting that the information and decision content of G20 summits is of limited relevance for market participants"[1]. Since the year 2014 when that research was produced the situation has arguably changed somewhat as intensifying crisis conditions associated with global imbalances and the COVID pandemic necessitated coordinated stimuli from the largest economies. Accordingly, the 2020 G20 summit was widely tracked by financial markets to ascertain the sufficiency of the coordinated stimulus in averting a pronounced global economic decline.

As regards the BRICS summits the last time that they mattered to financial markets was arguably in 2017 when China launched its BRICS+ initiative. The main focus at the time concerned the composition of the BRICS+ economies as well as the essence of the new format. In the end, the lack of a coherent message on the future of BRICS+ rendered the market impact insignificant. Nonetheless, economies that in 2017 were invited to take part in the BRICS+ platform used it to their advantage in dealing with capital markets. A case in point was Tajikistan that after becoming part of BRICS+ staged a successful Eurobond debut with the BRICS+ status being highlighted to investors during roadshows.

This year the situation with the BRICS summit is different in that the expansion in the core that is set to be discussed may have sizeable implications not only for the EM domain, but also for the entire global economy. Part of the reason is the sheer scale of the number of large developing economies that expressed the desire to join the bloc. Another reason why it matters to financial markets is because the BRICS are set to discuss the possibility of creating a new reserve/transactions currency of their own with palpable implications for the global monetary system. So, in view of how the discussions are shaping up in the run-up to the BRICS 2023 summit, what are the likely implications?

As regards the issue of BRICS expansion, the main focus of the financial markets is likely to be on economies such as Argentina and Saudi Arabia. For Argentina and other emerging markets with sizeable financing needs the accession to the New Development Bank (NDB) is likely to be a positive (for the main market segments such as equities and bonds) in terms of greater optionality of sources of financing and the possibility to obtain more funds for development with less stringent/burdensome conditionality. The significance of market's reaction is likely to depend on the scale of Argentina's and other EMs participation in the core BRICS or the expanded BRICS+ circle.

As for Saudi Arabia, its closer cooperation with BRICS may be important for solidifying the links with other partners of the Global South in the sphere of policy coordination in the oil and gas sector. BRICS/BRICS+ may become yet another venue for "resource diplomacy" in addition to OPEC+, which may further improve coordination mechanisms between developing economies in regulating commodity output and price levels. With the addition of economies such as Saudi Arabia and UAE the BRICS+ apart from being a formidable platform for the Global South regional powers and middle-income economies also becomes a key resource player globally. The market implications of such developments for commodities may imply a bias towards higher commodity prices in the medium- to longer term.

The factor that could affect the FX markets is the discussion at the summit on the possibility of a BRICS common currency. The main effect from these discussions is likely to be on the Chinese yuan as it is likely to receive the largest weight in the prospective BRICS currency basket and is currently seen as the main EM alternative to the US dollar. The yuan could be supported in international markets if the creation of a BRICS currency is discussed at the summit, with the results reflected in the final summit declaration. At this early stage, however, when the uncertainty over the future of the common currency is still significant, the market effects are likely to be moderate at best.

In the longer term, another possible ramification of the BRICS+ expansion may be the relative performance of EM assets vs. developed markets. A lot will depend on the modalities of this expansion and the degree to which it is going to be accompanied by greater trade and financial/investment liberalization on the part of the core BRICS economies. In case this pragmatic liberalization agenda is not forthcoming and if we see largely rhetorical declarations, the market effects could well turn out to be negative, particularly when the results fall short of elevated expectations. Be as it may, the markets will keep a close eye on BRICS developments in the coming weeks and it is very much in the hands of the BRICS economies to keep the market interest growing in the years to come.