USA
Source: www.bloomberg.com

As the COP28 talks wrapped up in Dubai, one of the world's energy heavyweights said it wants to rally a united front among a group of non-Western economies when confronting global climate issues.

Russia's "task is to combine efforts and common approaches in the Eurasian space and in the BRICS space" when it comes to the climate agenda, First Deputy Economy Minister Ilya Torosov said in an interview Tuesday at the COP28 conference.

The BRICS countries, which are seeking to be an alternative to the Group of Seven and up until this year were comprised of Brazil, Russia, India, China and South Africa, will be joined by Saudi Arabia, the United Arab Emirates, Iran, Ethiopia and Egypt in 2024. Russia will chair the BRICS group next year.

As part of its responsibilities, Russia plans to organize a contact group on climate issues, Torosov said. He insisted that even with sanctions imposed on Russia and an economy increasingly reoriented eastward away from the European Union, the country hasn't abandoned the climate agenda.

"We view decarbonization as a driver of economic growth," he said.

The US and its allies have imposed a raft of sanctions on Russia and sought to isolate the country on the international stage after the Kremlin's February 2022 invasion of Ukraine. The restrictions have targeted a wide array of economic activity, ranging from cutting banks off from the SWIFT international payment system to choking off imports of high-tech equipment.

Despite that, Russia remains a top oil and gas exporter and an important member of OPEC+, the alliance between the Organization of Petroleum Exporting Countries and other major oil producers. Russia also ranks among the largest suppliers of nuclear fuel.

Russia aims to increase the use of renewable energy sources by 2030, Torosov said. Hydroelectric and nuclear power plants, as well as natural gas, will remain part of the mix as Moscow seeks to reduce the share of coal it uses to power the country.

As part of that effort, Russia will create its own climate monitoring service focused on the oceans, permafrost, desertification and carbon absorption, he said, adding that 40 scientific organizations are currently working to launch it. Russia also intends to spend 10 billion rubles ($111.6 million) on scientific development.

The COP28 talks, hosted by the UAE, ended in an historic deal that committed the world to a transition away from all fossil fuels for the first time. The final agreement calls for countries to quickly shift energy systems away from the polluting fuel in a just and orderly fashion, qualifications that helped convince the skeptics. Countries also are called to contribute to a global transition effort — rather than being outright compelled to make that shift on their own.

Russia is satisfied with the results of this year's climate talks, Torosov said. Moscow also welcomes the fact that the next climate summit will be held in Azerbaijan, another major oil producer and a part of the OPEC+ coalition.

— With assistance from Sylvia Westall

Russia
Source: moderndiplomacy.eu

In a remarkable development echoing the evolution of global geopolitics, the BRICS group — an alliance heralding from Brazil, Russia, India, China, and South Africa — is expanding its sphere of influence. Starting on January 1, 2024, the group welcomed newcomers United Arab Emirates, Saudi Arabia, Iran and Ethiopia into its ranks. The move signaled a shift in global power dynamics as countries outside of traditional Western spheres became more prominent players on the world stage.

Diplomatic Maneuvers Drive Disruption to G7 Dominance

It was Russian President Vladimir Putin who was at the helm of the negotiations leading to this robust expansion. While Vladimir Putin was not at last August's South African BRICS summit, don't underestimate his personal involvement in building the coalition into a superpower. He is committed to its success. Putin's diplomatic journey to the Middle East last week has proved this. The trip included stops in the UAE and Saudi Arabia, a tête-à-tête with Iran in Moscow, and a telephonic chat with Egypt, underscoring the BRICS commitment to address thorny international dilemmas such as Ukraine, Gaza, and fluctuating energy dynamics.

The BRICS alliance, with its expanding roster, trails a divergent path from the traditional power blocs. In contrast with the G7, an alliance of developed nations, BRICS represents a wave of emerging economies. Collectively, the expanded BRICS now inhabits 45% of the global population, dwarfing the G7's population share of 9.7%. This demographic edge mirrors the relative land size – with BRICS sprawling over 36% of the globe versus the G7's 16.1%.

The expanded BRICS bloc also leads in resource bounty and output. Based on the 2021 data, the block's wheat production encapsulates 48.7% of the global yield, overtaking G7's 19.1%. In terms of oil reserves, BRICS holds a commanding 44.4% of the world's known reserves, against G7's meager 3.9%.

Amidst sanctions levied against Russia and Iran, the growth of BRICS into a formidable world union showcases influential sway, outdoing the G7 across several fronts.

China, a stalwart of the BRICS alliance, recognizes the ascendant influence of these nations as they shape a new world order. In the words of Chinese President Xi Jinping, "BRICS countries are playing a more important role in the current international landscape."

Interestingly, the sanctions have proved ineffective in stifling the rise of such an influential alliance. While credit for the success of BRICS might arguably go to China or India, it's undeniable that this ascendancy has been a multinational maneuver. Yet, one can hardly overlook Putin's part, who valiantly challenged the G7 and the existing hegemony. To Putin, the BRICS union is a sign of global defiance and a potent tool mitigating against the sanctions' effects. The rise of BRICS is a resounding testament to the multipolar world's emergence, challenging once unchallenged unilateral dominance.

The Untapped Fashion Frontier

The BRICS alliance has traditionally focused its collective gaze on sectors such as energy, technology, and food security, leveraging the group's potential to significantly impact these critical industries. However, venturing into the lucrative world of fashion could represent a new frontier for this global coalition. This was evident at the recent BRICS+ Fashion Summit in Moscow.

Globally, with an evaluation over $2,4 trillion, the textile and apparel industry ranks as the second largest consumer-driven sector, only surpassed by food production. This vast market presents myriad opportunities for innovative approaches and diversified influence.

China, India, and Pakistan have already established themselves as Top 3 powerhouses in the textile and apparel manufacturing sphere. To underscore this, 2022 statistics from the China National Bureau reveal that China's clothing exports amounted to an impressive $182 billion, capturing 31.6% of the global market share, even without considering the contributions of India and Pakistan.

Nevertheless, the influence of BRICS countries on crucial aspects of the fashion industry, such as trends, brand development, and worldwide distribution, remains strikingly limited. Data from the United Nations Industrial Development Organization (UNIDO) highlights a landscape dominated by a select few global brands. These well-known labels, though constituting less than 3% of all brands, capture approximately 50% of global sales, which creates an imbalance within the fashion sector.

Recent events in Russia, however, signal the possibility for change. In the past years, major international fashion giants, including Zara and Prada, have withdrawn from the Russian market due to sanctions. This has left a void that local brands have eagerly filled, capitalizing on the lack of competition from major international corporations. As a result, Russian fashion brands have been empowered, tapping into sizable local demand. According to Moscow's government, this shift has led to a sevenfold increase in the manufacturing of apparel and home textiles in the Moscow region in the past year.

Taking cues from Russia's experience, it is clear that, under the right circumstances, BRICS nations have the potential to make inroads into the fashion industry. By refocusing their efforts and adopting bespoke strategies, the alliance can elevate their fashion industry standing, transform trends and, by leveraging their existing manufacturing capabilities, assume a more prominent role on the global fashion stage.


Reshaping the Global Fashion Narrative

Fashion, with its potent mix of cultural influence, economic power, and global relevance, is a key sector that the BRICS nations are beginning to probe with the same alacrity gifted to other critical infrastructure projects, such as energy, sustainability, and security.

Their collective foray into the fashion world could potentially unlock significant economic growth, generate employment opportunities, and amplify cultural diplomacy.

The commitment as reflected during the COP28 summit in Dubai, by the BRICS nations to ecological improvements, marries well with the industry's pressing need for sustainable practices. Fashion, after all, ranks among the world's most polluting industries.

The interweaving of environmental consciousness with fashion ideology was convened at the recent BRICS+ Fashion Summit in Moscow. The far-reaching event, drawing more than 60 nations' delegates, bore testament to the international gravitas of the fashion industry and the shared appetite for addressing its challenges and opportunities.

In the corridors of the Summit, earnest discussions were ignited about the primarily passive role of BRICS nations as masses of fashion consumers rather than as creators or trendsetters. A critical determination emerged from these conversations: that local markets must be unwrapped for local designers and their brands promoted internationally, thereby amplifying the creative echo of the BRICS alliance in the global sartorial arena.

Such sentiments gain urgency considering the expansive growth of the apparel and textile industries, which BRICS nations already significantly shape. The Summit lent its voice to the gospel of sustainability, stressing the urgency of addressing environmental issues head-on.

Addressing Labor and Environmental Concerns

But the sustainable issues that major apparel players China and India face could postpone their growth as trendsetters. For BRICS fashion brands, the draw of sourcing textiles from countries like China and India is unmistakable, given the strength of their manufacturing bases. Yet, this approach raises numerous sustainability issues that must be confronted, including a lack of education for textile workers, inadequate labor rights, and subpar working conditions.

India, for instance, relies heavily on an informal workforce, requiring significant investments in large-scale training programs to boost the skillsets of textile workers. To forge a truly sustainable supply chain, reforming the textile labor force within the BRICS countries is indispensable. This reform would involve substantial investments in shared infrastructure for recycling, as well as extensive vocational training programs to enhance understanding of regenerative textile agronomy.

Recognizing the sector's influence on the market, institutions like the United Nations Environment Program (UNEP) and the United Nations Climate Change (UNCC) have joined forces to assemble a sustainable fashion communication toolkit. With communication's persuasive power, the goal is to spur market shifts toward more sustainable lifestyle choices while decoupling value creation from resource extraction.

The updated UNCC fashion charter underscores the urgency of phasing out fossil fuel-based fashion. With polyester—accounting for 63% of the fiber market—still predominating, the journey toward environmental responsibility is far from over. Recent research has sounded an alarming bell, revealing that polyester is accountable for a staggering half a million tons of plastic microfibers shed from laundered clothing each year. This astonishing volume contributes significantly to the escalating concern of oceanic pollution.

Dealing with the multifaceted challenges presented by the fashion industry's intricate ecosystem demands a cohesive and collaborative approach among the BRICS nations, as epitomized by the recent BRICS+ Fashion Summit. The Summit's extensive dialogues, which engaged over 60 nations—home to nearly two-thirds of the world's population—successfully disseminated the environmental defense message across continents.

The urgency of such issues is evident in Africa, where the importation of textile waste from Europe has reached alarming levels, exceeding 1.7 million tons annually. This stark reality highlights the vital need for concerted efforts by BRICS countries to bring about meaningful change.

United by the belief that a more sustainable, ethical, and prosperous future in fashion is within reach, the BRICS nations must remain steadfast in their quest to confront labor and environmental issues head-on. Through deliberate and coordinated action, they possess the collective power to reshape the global fashion sector for the better.

A New Chapter in Consumer Economics

The BRICS+ Fashion Summit served as an enlightening platform, emphasizing the utmost importance of cultural sensitivity and inclusivity in modern fashion design. The summit forged a clarion call to eschew cultural appropriation; it illuminated the critical necessity to understand, respect, and celebrate the bounty of varied cultures without resorting to misrepresentation, exploitation or theft.

Signalling a departure from their previous concerns around in-depth global mineral resources, the BRICS countries shimmered on this international platform, embarking on an exploratory collective journey into the realm of consumer economics. This shift marks the genesis of a new chapter in the historical logbook of the BRICS alliance, which is, in essence, a politically motivated configuration now establishing robust roots as a geopolitical heavyweight. A pivot towards consumer-focused sectors, with the emotionally charged and deeply saturated fashion industry in the crosshairs, signals an audacious challenge to the traditional Western stranglehold that has dominated the fashion domain for decades.

A considerable part of the summit's dialogue centered on the revolutionary concept of a unified market for fashion commodities. As China already possesses a strong foothold as a key market, its potential confederation with other emerging economies could be the catalyst for a seismic business boom. This could potentially rival, if not eclipse, the entrenched fashion capitals – Milan, Paris, New York, and London.

As this fashion world order continues to unfold, there is an emerging trend towards the east and south. This shift propels other urban bedrocks to the fore. Beijing, Mumbai, Moscow, Cape Town and Dubai, the rapidly ascending star on the Middle Eastern stage, are prepared to vie for supremacy against the traditional fashion powerhouses. This shift portends an exhilarating reshaping of the global fashion cartography, following the BRICS expansion.

United Kingdom
Source: markets.businessinsider.com

• US policymakers should be concerned about a BRICS-led dedollarization, Thomas Hill wrote for the Atlantic Council.
• New members can provide BRICS with new trade affiliations to promote dedollarization.
• "Collectively, the expanded BRICS network via these trade organization connections now eclipses 90 countries."

The recent expansion of BRICS should be a key cause of concern for the US, as new members along with countries who want to join could amplify dedollarization, according to a former State Department official.

Writing for the Atlantic Council, Thomas Hill noted that Egypt, among others, was added to the BRICS club while Algeria and Tunisia were turned down.

And it foreshadows how North African countries may become some of the "most aggressive advocates" for de-dollarization, he warned.

"The BRICS-led dedollarization effort should alarm US policymakers, especially in light of the recent BRICS membership expansion," wrote Hill, who is currently the director for the North Africa Program at the US Institute of Peace. "It is clear that traditional US allies, such as Egypt, Saudi Arabia, and the UAE, are already exploring ways to dedollarize, and that Beijing is helping that process move forward."

This year, the economic bloc — originally composed of Brazil, Russia, India, China, and South Africa — has touted plans to take on the greenback's dominance in the global financial system.

While BRICS' attempts to replace the dollar's hegemony have had limited impact so far, the coalition also elected to admit six new states in August, creating an opportunity for greater global coordination, Hill explained.

He added that they will provide BRICS with access to fresh trade affiliations that can promote alternative currencies.

"By including Egypt, BRICS can influence Algerian and Tunisian de-dollarization through Egyptian leadership inside existing trade regimes. Through Egypt, the UAE, and Saudi Arabia, BRICS will have expanded access to the Greater Arab Free Trade Area (GAFTA) and the Common Market for Eastern and Southern Africa," Hill wrote. "Collectively, the expanded BRICS network via these trade organization connections now eclipses 90 countries."

Signs of change are showing. In October, Egypt issued yuan-denominated panda bonds to help pay its debt, while the Bank of Russia now includes the Egyptian pound among currencies used to set ruble exchange rates.

Elsewhere, a joint effort between China, Hong Kong, Thailand, and the UAE looks to develop a digital currency platform that will create a digital yuan for cross-border payments, Hill said.

Even a partial weaning off the greenback will likely weaken incentives to stick to the SWIFT finance mechanism, an international banking network that has been used by the US to apply sanctions.

Global coordination against the dollar would also impact US fiscal health, limiting the country's ability to run large federal deficits and keep debt costs grounded, Hill said.

"For US policymakers, the BRICS de-dollarization effort should cause concern," he said, adding that the federal government needs an interagency process with backing from lawmakers.

China
Source: www.chinadaily.com.cn

Inclusion of six new members promises to reshape world economic and political order
The BRICS Summit held in South Africa this year will go down in history as a meeting at which a milestone was reached to shape the group's direction.
During the summit in Johannesburg the BRICS group of emerging economies of Brazil, China, India, Russia and South Africa extended an invitation to Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates that are expected to officially join the group next month.
After the enlargement, experts say, the platform will increase the influence of the Global South, which has traditionally been neglected in terms of economic growth and policies.
Aly Khan, an investment banker in Kenya, said the recent developments in BRICS, such as greater cohesion, its expansion and growing local currency settlement, all point to a grouping that is flexing its muscle.
BRICS expansion is significant, he said, foreshadowing a potentially new financial architecture and an ambition to reform global governance.
Cavince Adhere, an expert on international relations with a focus on China-Africa relations, said BRICS expansion will make the bloc an important platform for international collaboration, especially among Global South countries.
The bloc, with a combined population of more than 3.2 billion, accounts for about 42 percent of the world's population, a quarter of world GDP and 17 percent of world trade.
"That tells you how important it is," Adhere said. "It's now composed of the largest market in the world."
The bloc also brings together resource-rich countries, he said.
The future of BRICS will depend on its ability to deliver on the aspirations of the members that have already joined and those that are keen to join, he said.
"The 2023 summit held in South Africa was modeled on BRICS cooperation with African countries. And that simply tells of the strategic direction that the leaders of the BRICS countries are moving in — not leaving anybody behind."
The emergence of BRICS is a reflection of the desires of Global South countries to come together and reimagine their development discourse in addition to giving themselves a voice in global governance, he said.

Russia
Source: moderndiplomacy.eu

BRICS is an intergovernmental organization comprising Brazil, Russia, India, China, and South Africa. It encompass about 27% of the world's land surface and 42% of the global population. Brazil, Russia, India, and China are among the world's ten largest countries by population, area, and GDP (PPP). All five states are members of the G20, with a combined nominal GDP of US$28 trillion (about 27% of the gross world product), a total GDP (PPP) of around US$57 trillion (33% of global GDP PPP), and an estimated US$4.5 trillion in combined foreign reserves as of 2018.

2024 expansion

In August 2023, at the 15th BRICS Summit, South African President Cyril Ramaphosa announced that six emerging market group countries (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates) had been invited to join the bloc. Full membership is scheduled to take effect on 1 January 2024.

Countries that have applied for membership

A total of 14 countries have formally applied to join BRICS, listed as follows:

Algeria, Bahrain, Bangladesh, Belarus, Bolivia, Cuba, Honduras, Kazakhstan, Kuwait, Pakistan, Palestine, Senegal, Thailand, Venezuela, Vietnam,

Potential further expansion

In addition, Afghanistan, Angola, Comoros, DR Congo, Gabon, Guinea-Bissau, Libya, Mexico, Myanmar, Nicaragua, Serbia, South Sudan, Sudan, Syria, Tunisia, Turkey, Uganda, Uruguay and Zimbabwe have expressed interest in membership of BRICS.

BRICS may Emerged the Second Largest Platform just after the UN

Current BRICS will become 13 members group on 01 January 2024, after joining 7 new members. 14 Countries have already formally applied for joining BRICS, which will make BRICS a group of 27 Nations soon. If consider the potential members I the near future, it will be group of around 50 countries. If the same pace of expansion is maintained, soon it will become second largest platform after the UN. As a matter of fact, the victims of unipolar world, find an outlet to escape from hegemony of Western world. BRICS have a potential to emerge as a largest alliance with largest area, population, resources, etc., it might transform the largest economy soon.

BRICS Significant Initiatives

New Development Bank

The New Development Bank (NDB), formally referred to as the BRICS Development Bank, is a multilateral development bank operated by the five BRICS states. The bank's primary focus of lending is infrastructure projects with authorized lending of up to $34 billion annually. South Africa hosts the African headquarters of the bank. The bank has a starting capital of $50 billion, with wealth increased to $100 billion over time. Brazil, Russia, India, China, and South Africa initially contributed $10 billion each to bring the total to $50 billion. As of 2020, it had 53 projects under way worth around $15 billion. In 2021, Bangladesh, Egypt, the United Arab Emirates and Uruguay joined the NDB. It is not a replacement of existing global financial institutions, like World Bank, IMF, Asian Development Bank, Islamic Development Bank, Asian Infrastructure Investment Bank, etc. but, is supporting the existing financial system and an positive additions to it.

BRICS Contingent Reserve Arrangement

The BRICS Contingent Reserve Arrangement (CRA) is a framework for providing protection against global liquidity pressures. This includes currency issues where members' national currencies are being adversely affected by global financial pressures. Emerging economies that experienced rapid economic liberalization went through increased economic volatility, bringing an uncertain macroeconomic environment. The CRA competes with the International Monetary Fund (IMF). Along with the New Development Bank, it is an example of increasing South-South cooperation. It was established in 2015 by the BRICS countries. The legal basis is formed by the Treaty for the Establishment of a BRICS Contingent Reserve Arrangement, signed in Fortaleza in July 2014. With its inaugural meetings of the BRICS CRA Governing Council and Standing Committee, held on 4 September 2015, in Ankara, Turkey it entered into force upon ratification by all BRICS states, announced at the 7th BRICS summit in July 2015.

BRICS payment system

At the 2015 BRICS summit in Russia, ministers from BRICS nations initiated consultations for a payment system that would be an alternative to the SWIFT system. The stated goal was to move to settlements in national currencies. The Central Bank of Russia highlighted the main benefits as backup and redundancy in case there were disruptions to the SWIFT system. China also launched its own alternative to SWIFT: the Cross-Border Interbank Payment System, which enables financial institutions worldwide to send and receive information about financial transactions. India also has its alternative Structured Financial Messaging System (SFMS), as do Russia SPFS and Brazil Pix.

Potential common currency

BRICS countries committed to study the feasibility of a new common currency or similar, at the 2023 BRICS summit in South Africa. Fair and easier international trade as well as a major reduction in costs of transactions would be some of the reasons why the countries could forge a currency union. Dependence on US Dollars may be reduced drastically.

BRICS Partnership on New Industrial Revolution innovation Center (BPI):

China being the most important member of the BRICS, having a strong will and huge capacity to contribute in BRICS has established BRICS Partnership on New Industrial Revolution innovation Center (BPI).

17 November 2020, President Xi Jinping announced that China will set up an innovation center for BRICS partnership on new industrial revolution in Xiamen City of Fujian province with a clear focus on policy coordination, personnel training and project development.

On 8 December 2020, the 2020 BRICS Forum on Partnership on New Industrial Revolution was successfully held in Xiamen, during which the BRICS Innovation Center was formally launched.

BRICS representatives and relevant international organizations gathered in Xiamen to witness the official launch of the innovation base for the BRICS Partnership on New Industrial Revolution.

It has become an important platform for the BRICS members to promote partnerships and to leverage each other's strengths to develop and prosper against the background of the Fourth Industrial Revolution. However, it is open to non-BRICS members too.

Major Significance

1. A major initiative aimed at leading results-oriented BRICS cooperation, which was proposed by President Xi Jinping after taking into consideration of the overall interests and future development needs of all stakeholders.

2. An innate requirement and important platform for delivering closer BRICS cooperation and strengthening PartNIR.

3. A key driver for materializing PartNIR and a brand new platform for deepening BRICS cooperation.

Development Goals:

The BRICS Innovation Base adheres to the BRICS spirit of openness, inclusiveness, and win-win cooperation. It focuses on the implementation of the BRICS Partnership on New Industrial Revolution, and the innovation and cooperation in the industrial field. It also considers trade and investment, cultural exchanges, and other fields as a whole. Besides, the base systematically carries out international exchange and cooperation activities, enhances the impetus to BRICS cooperation and the ability to jointly meet the challenges of the new industrial revolution, and promotes the common realization of technological progress, economic prosperity, and social development.

The BRICS Forum on Partnership on New Industrial Revolution 2023 held in Xiamen, Fujian province on Nov16, 2023.

Better communication and policy coordination among BRICS countries have been called to deepen partnerships in areas such as smart manufacturing, new material and artificial intelligence.

Zhang Yunming, vice-minister of industry and information technology, said more efforts can be made to seize the opportunity of the new industrial revolution and jointly promote the industrialization process of the BRICS countries. He called for a greater push to strengthen policy communication and dialogue among governments, industries and academia on intelligent manufacturing, new materials and artificial intelligence; to carry out cooperation and training projects in cultivating new tech human resources; and to jointly promote inclusive and sustainable industrialization processes. He made the remarks at the BRICS Forum on Partnership on New Industrial Revolution 2023 in Xiamen, Fujian province on Thursday.

According to him, more efforts are needed to strengthen cooperation in digital infrastructure construction, bridge the "digital divide", promote the digital transformation of the manufacturing industry and better benefit the development achievements of BRICS countries. "We also need to adhere to the concept of sustainable development and seek green industrial development in BRICS countries," Zhang added.

BPI is well established, equipped, and supported by the Government of China, is functional very well and delivering its initial objectives appropriately.

Russia
Source: russiancouncil.ru

The nations of BRICS have repeatedly called for the enhancement of their role and status within the current global financial system, which was long overdue. In this vein, the declaration of the 11th Brazil Summit held in November 2019 expressed disappointment of BRICS leaders with the results of the 15th General Review of IMF quotas, which failed to ramp up the total voting power of BRICS in the Fund. The five nations also declared their support for cooperation in the development of bond markets in BRICS national currencies, in a bid to increase their financial security profile amid unpredictable developments in the global financial environment.

Adopted on August 23, 2023, the Declaration of the 15th BRICS Summit on the admission of six new members to the group (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and UAE) is intended to strengthen cooperation among BRICS in the domain of international finance. In particular, it is about fostering further dialogue on payment instruments to facilitate trade and investment flows between the BRICS members as well as among other developing nations. The Parties called for more robust correspondent banking networks among the BRICS nations as well as for making settlements in local currencies possible.

In anticipation of the next BRICS summits to be held under the chairmanship of Russia in 2024 and Brazil in 2025, experts hope that BRICS will work together toward effective multilateral mechanisms for mutual settlements and payments. For example, former IMF executive director and former vice president of the New Development Bank, Brazilian economist Paulo Nogueira Batista Jr., does not rule out the possibility of a common BRICS currency and it being presented at the next year's summit in Russia.4

A Bit of Background

It has been 22 years since James O'Neill, the newly elected head of global economic research at Goldman Sachs investment bank, introduced the acronym of BRIC. With this neologism, the British economist hoped to draw investors' attention to the economic potential of four fast-growing emerging markets – Brazil, Russia, India and China. In his provocative publication titled Building Better Global Economic BRICs, O'Neill proposed to transform the Group of Seven (G7) into the Group of Nine (G9) by excluding two of the three Eurozone representatives and including the BRIC nations instead. The Asian financial crisis of 1997 and Russia's default in 1998 (commonly associated with the notorious collapse of the American fund LTCM) objectively required new approaches to regulating the international movement of capital and the exchange rate for the leading reserve currencies. O'Neill argued that having the most dynamically developing economies on the influential advisory panel of developed nations could contribute to more balanced decisions in international economic policy. However, the G7 seemed unprepared for such radical reforms, sticking to its composition as it was. As a compromise, the Group of Twenty (G20) was later established, with the emerging market economies involved. Meanwhile, G20's real potential to influence the transformation of international financial architecture has been questionable so far as global institutions with operational capacity—the IMF, the World Bank, the Bank for International Settlements, the Financial Stability Board—do not make any shifting moves without the G7 approval.

As for BRICS, after its enlargement through the expansion up to eleven member states, this grouping has bolstered its influence on three continents. Today, BRICS-11 accounts for 44% of global oil production and consumption, 36% of gas production and consumption, 70% of steel production and 65% of steel consumption, 44% of fertilizer production and 46% of fertilizer consumption, 57% of food production and consumption, and 48% of automobile production. Despite an impressive share in the international division of labor, the role of the BRICS nations in the global financial system remains quite insignificant since key instruments and institutions are still under the control of the U.S. and its allies. The U.S. dollar continues to play a major role in pricing on the global currency and credit markets, as well as acting as the main currency for invoicing in international trade, nominating international securities, and forming official foreign exchange reserves. The ability of sovereign and corporate borrowers to raise financial resources in international capital markets continues to depend, as was before, on the opinion of the three U.S. credit rating agencies. The U.S. retains its veto power in the Bretton Woods institutions, exerting enormous political influence on the international settlement and payment systems.

What are the chances of BRICS, under the current circumstances, to take a place in the global financial system that would correspond to their contribution to the real sector of the world economy? To answer this question, we need to consider the grouping's current positioning in global finance.

Foreign exchange markets

The international foreign exchange market (FOREX) is the backbone of the global financial system. It is here that the virtual value of world currencies as key reserve assets is determined based on exchange quotations. As reported by the Bank for International Settlements, the daily turnover at FOREX exceeded USD 7.5 trillion in April 2022. The share of the U.S. dollar in the structure of foreign exchange trading amounted to 88%, whereas the combined share of BRICS-11 currencies was only 9%. Geographically, the UK and the U.S. accounted for 57.6% of trading, while the BRICS-11 – for only 3.2%.

The international foreign exchange market is an oligopoly of U.S. banks, which serviced 38.15% of total international foreign exchange trade in 2022.9 Over 70% of all FOREX transactions globally were conducted through the U.S.-controlled Continuous Linked Settlement (CLS).

As the world's largest clearing system, CLS eliminates the risks of non-payment by counterparties on concluded currency transactions. Supposedly, the inclusion of national currency in the list of CLS currencies is one of the markers of its reliability for investors. Of the BRICS-11 currencies, only the South African rand enjoys this privilege. Currently, CLS conducts operations with 18 currencies, including such exotic ones as the Hungarian forint and the Israeli new shekel, whose shares on FOREX are much lower than those of the Chinese RMB, the Indian rupee, the Brazilian real and the Russian ruble. Nevertheless, the currencies of these leading BRICS nations continue to be overlooked by the global dealer banks that are major CLS shareholders. This is a significant obstacle to BRICS attaining more prominent positions in the international FX market.

Credit markets

Although the international credit market is much smaller in volume than the international FX market, it is an important indicator of a country's participation in the redistribution of global financial resources and, consequently, of its role in global financial intermediation. Only China has so far made significant progress in this segment among the BRICS-11. According to the British TheCityUK, the size of China's total banking assets (USD 61.7 trillion) in Q2 of 2022 was almost three times higher than that of the U.S. (USD 22.8 trillion) and five times higher than that of the UK (USD 12.4 trillion). That said, the UK accounted for 15% of international bank loans, the U.S. had a share of 9%, while that of China was only 4.3%. The dominant role of the UK in the international credit market is due to London's status as a global center for foreign banks, of which 180 place their subsidiaries or branches here, which is virtually half of the UK banking sector's revenues.

Despite the growing number of foreign banks with a business license in China, their expansion is constrained by current capital account restrictions, the scarcity of unoccupied niches in a market tightly controlled by local Chinese banks, sudden regulatory changes and government interventions. With the consistently high interest of foreign banks in the Chinese market, the share of their total assets in the Chinese banking system has still declined from the 2.3% peak in 2007 to 1.4% at the end of 2021, due to, among other things, the COVID pandemic and the strained diplomatic relations between Beijing and Washington.

The share of RMB in denominating internationally-traded debt securities remains extremely low as well. In Q4 of 2022, it stood at only 0.7%, while the share of the U.S. dollar was as high as 65.5%. China is still the second (next to Japan) largest overseas investor in U.S. government bonds, although the latter have contracted in the China's portfolio from USD 1,121 billion in March 2019 to USD 859 billion in January 2023.

RMB's internationalization through the international credit market could be facilitated by the issuance of panda bonds, which are RMB-denominated debt securities of foreign issuers quoted and traded in the domestic market of mainland China. Deutsche Bank suggests that the issuance of panda bonds in Q1 of 2023 reached a record high of RMB 72 billion (USD 10 billion), up 33% year-on-year.16

America's Big Three credit rating agencies (S&P Global Ratings, Moody's, Fitch) play an important role in the international credit market, wielding much influence on the cost of financial resources for various categories of corporate and sovereign borrowers. The methodology of rating assignment, used by the Big Three, has repeatedly subject to criticism due to conflicting interests and information asymmetries. The failed attempt to establish BRICS' own credit rating agency has demonstrated the limited ability of the five nations to influence the entrenched order in the international credit rating market. In 2013, the Russian Rus-Rating agency in cooperation with China's Dagong and the U.S. rating company Egan Jones founded an experimental international rating agency in Hong Kong, the Universal Credit Rating Group. The task was to offer a prototype of the new international rating system to ensure safer development by providing the global financial community with reliable rating information. However, the project was suspended due to disagreements between the Russian and Chinese rating agencies and their national regulators.18

Another factor constraining China's growing influence in the international credit market could be the country's declining involvement in financing of large-scale projects in emerging markets within the Belt and Road Initiative (BRI) on continents such as Africa, Asia, and Latin America. According to Foreign Affairs, during the first five years of the BRI's operation, China's spending on overseas transportation and energy infrastructure doubled that of the U.S., peaking at USD 120 billion. That was in 2016. However, between 2016 and 2019, China's sovereign commitments of lending to BRI projects fell by 94% to a mere USD 3.9 billion. The curtailment of China's lending activities in emerging markets was a deliberate decision taken by the Chinese government, largely due to the inefficient use or misuse of the funds provided, caused by persistent corruption in the governments of host economies and a weak market demand for the completed projects.

The slowdown of China's activity in the financing of strategic infrastructure in developing markets potentially means that they remain dependent on credit from the U.S. and other developed nations of the West, which potentially lowers the status of China and other BRICS member states as international lenders.

Payment Systems

The BRICS-11 accounted for 22.0% of global exports of goods and services in 2022. However, most settlements in international trade are made in the G7 currencies through the SWIFT interbank system. SWIFT members are more than 11,000 banks from 200 countries, including 300 credit institutions from Russia. The majority of SWIFT transactions are made in U.S. dollars, euros and pounds sterling. In September 2023, the shares of the three currencies stood at 45.58%, 23.6% and 7.32% respectively. The RMB was only the fifth most popular payment currency on this network (3.71%) right below the Japanese yen (4.2%). However, 84.02% of international transactions in RMB are conducted through offshore banks in Hong Kong, the UK and Singapore. Among the BRICS-11 countries, only Russian banks supported settlements in RMB, which accounted for 1.9% of all transactions.

Some optimism is inspired by the fact that in the market of trade finance and settlements via SWIFT the RMB ranked second with a share of 5.8% (the share of the US dollar stood at 84.15%, euro – at 5.43%). Trade financing is a set of financial instruments such as a letter of credit, export credit or insurance coverage that enable an importer to obtain a deferred payment for goods. However, the size of the global trade financing market is small. For example, in 2022, it was estimated at USD 48.2 billion, which corresponds to only 0.03% of the total amount of payments serviced via SWIFT.

Tellingly, final settlements (clearing) of transactions, with information thereon transmitted via SWIFT, are carried out through payment systems much larger in volume than SWIFT. For example, the U.S. Clearing House Interbank Payment System (CHIPS), owned by leading U.S., European and Japanese banks supports the majority of cross-border dollar payments. In 2021 alone, settlements were made for transactions USD 407 trillion worth. The TARGET2 payment system, operated by the European Central Bank, supported transactions more than EUR 466 trillion (about USD 520 trillion) worth in 2020. In 2021, Chinese payment systems (HVPS, BEPS, IBPS, CFXPS, CIPS, etc.) processed a total of RMB 9.5 quadrillion (about USD 1,500 trillion) worth of payment transactions. These systems have internal messaging systems to facilitate non-SWIFT payments, but most of the large international payments are linked to SWIFT financial messages. In 2020, USD 140 trillion worth of financial messages were broadcast through SWIFT to make payments. By comparison, less than 0.5% of SWIFT's transaction volume passed through China's Cross-border Interbank Payment System (CIPS), the rest of the volume fell to the share of offshore banks.

Therefore, the real independence of BRICS from the international payment infrastructure controlled by the West can only be ensured by their own system of multilateral settlements in national currencies. Since 2018, a prototype of such a system has been developed under the BRICS PAY venture project, which combines the advantages of traditional payment systems with new technologies such as central bank digital currencies, decentralized financing and tokenized assets.

Currently, external settlements between BRICS member states still require conversion into U.S. dollars involving U.S. banks. For example, RMB-RUB cashless settlement using China's UnionPay payment system cannot occur directly, as conversion into U.S. dollars is needed first. Therefore, the primary objective of the BRICS multilateral settlement system is to enable direct exchange of national currencies for external payments.

Conclusion

The role of BRICS in the global economy is currently limited mainly to the production of strategic raw materials, low and medium value-added manufacturing goods as well as to providing transnational businesses with cheap labor. The global financial system is still leveraged by a coalition of developed nations led by the United States. Under the current monetary standard, the nations of BRICS do not receive adequate financial compensation that would correspond to their contribution to the real sector in global economy. Given the established rules of the international foreign exchange and credit markets, BRICS are, in fact, deprived of the possibility to make settlements and payments in their own currencies in the jurisdictions under their control. Essentially, their role in the global financial system is reduced to buying low-yielding bonds of developed nations as a key reserve asset. Meanwhile, Western countries have exhausted the possibilities of productive use of "excessive" financial resources accumulated in emerging markets, which leads to the growth of global debt and inflation.

The use of the U.S. dollar as a key reserve currency begets a configuration of international settlements, where BRICS, seeking access to international liquidity, are forced to produce a certain amount of goods for the external market in excess of what is actually needed by their economies, which is often accompanied by a devaluation of national currencies to ensure their international competitiveness. Such "overproduction" often draws financial and other resources from other national industries, putting the economy in a long-term dependence on the priority development of the export sector to the detriment of the national monetary unit stability as well as of other strategically important national industries.

To overcome these imbalances, the nations of BRICS will have to develop such a system of mutual multilateral settlements that will make it possible to channel international financial flows toward priority industries at the interregional level, which will smooth out structural imbalances as a cause of chronic lagging behind the leading group of the industrially developed nations as in their socio-economic development. Obviously, this is the only way to eliminate the G7's monopoly in global financial flows and create real conditions for a stronger competitive position of BRICS in the global financial system.

New Zealand
Source: www.asiamediacentre.org.nz

An Expanding BRICS Marks The Global South's Coming of Age

At the beginning of 2024, a major – but frequently under-reported and under-estimated – international organisation, the BRICS, will double its number of members. Adding Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates to the current members Brazil, Russia, India, China and South Africa, this expansion will signify a major new phase for what is arguably the developing world's foremost multilateral organisation.

It will also add greater credence to the group's demands for a more equitable and representative world, as well as indicating "wide-ranging global south support for a recalibration of the global order".

Already representing around 42% of total global GDP and about 27% of global territory, this expansion will increase the economic power for the grouping.

It will also advance the cause of the Global South across the world, as well as the diplomatic allure of its existing members as being capable of asserting their collective influence and clout. 14 other countries (Algeria, Bahrain, Banglasedh, Belarus, Bolivia, Cuba, Honduras, Kazakhstan, Kuwait, Palestine, Sengal, Thailand, Venezuela and Vietnam) have further formally applied for membership, with many others expressing an interest, signifying that this expansion is the first of many to come. All BRICS countries must however agree to any accession, with Indonesia being turned down.

Seeking a Genuine and Respected Voice

With origins dating from the aftermath of the 2008 global financial crisis, the first BRI C Summit was held in Yekaterinburg in Russia. South Africa then joined in 2011, making BRIC into BRICS. Most of them were experiencing a slow change in their status from developing into proto-developed entities. This evolution was difficult for existing bodies such as the World Trade Organisation (WTO), International Monetary Fund (IMF), the United Nations Security Council (UNSC) and many others to fully grasp and respond to. As a result, there was a disconnect between the BRICS's ambitions and existing western-dominated architectures.

Added to these dynamics, which are again echoed by the latest cohort of new members, was a sense that the unrepresentativeness of global institutions bred a degree of reliance that reduced the autonomy of these countries.

In addition, the economic chaos of the 2008 global financial crisis, as well as the inadequate structural response to it, fed a perception that the West was not the best custodian of these developing - and quickly expanding - economies.

The BRICS' New Development Bank – as an alternative to the World Bank and the IMF – explicitly underlines this ethos, whereby the Global South can foster its own development needs and direction outside of the often-unequal development strategies propagated by the West.

Its central aim is to transfer knowledge, technology, and capital between developing countries, as well as to expand mutual trade routes and markets, and ensure energy security.

Breaking the inequities of North-South cooperation that was based upon aid and assistance, the BRICS' South-South model is centred upon sustainable and collective growth. This is the key mantra of the New Development Bank, which as of June 2023 had lent around $33 billion to 96 development projects compared with some $67 billion lent by the World Bank. Such figures are remarkable given that the New Development Bank was only established in 2013.

Building from their economic influence, BRICS countries have evolved their diplomatic impact to include advocating for increased involvement in global security issues.

Such an outlook includes issues such as transnational terrorism, cyber security and how to respond to climate change, and recognises the different challenges - and responsibilities - of developing and developed economies.

A particular de-emphasis upon military power – in marked contrast with the current world order and its leadership under the aegis of the United States – also seeks a more cooperative and multilateral approach that rejects alliances and opposing blocs.

BRICS Phase Two

The BRICS' forthcoming expansion activities presents a clear challenge – if not potential threat – to the dominant financial organisations of the Western world order.

With its economic size already tilting towards half of all global GDP and now involving some of the world's oil and gas producers, a new centre of power is being established in global affairs.

The latest expansion also signals a shifting of influence away from the West. That the political basis of BRICS members is highly mixed in nature – including mature democracies and openly autocratic regimes – makes the grouping ever more attractive but also difficult to respond to.

The ascent of new countries to the BRICS in January 2024 is a clear validation of the grouping that will foster and accelerate economic interlinkages between members. It will also enhance the BRICS' geographic and demographic diversity across the world's emerging markets, which will make the grouping ever-more representative, valid and pertinent within global affairs. The different motivations of these new members also point to its multifaceted magnetism, whereby the BRICS can appeal to countries in a range of development and diplomatic ways.

Emblematic of this appeal, Argentina is pursuing membership to assuage a severe internal economic crisis, and "to open up our possibilities of joining new markets, of consolidating existing markets, of raising investment coming in, of creating jobs and raising imports". Doing so will also provide the country with an alternative to traditional Western economic solutions that historically have often been disastrous. In turn, Egypt desires to leverage its geographic position to enhance its cross-border trade and infrastructure projects, and global influence.

Similarly, Ethiopia as one of the fastest-growing economies in Africa seeks greater access to capital, expertise, and experience necessary for its sustainable – as well as infrastructure – development. Iran and Saudi Arabi can benefit in the same fashion but can also diversify their external energy markets, especially Tehran which is impacted by Western sanctions.

Both can further use the BRICS as an additional platform to advance their foreign policy goals. The United Arab Emirates is drawn to the BRICS as a way to foster collaboration in the areas of technology transfer, clean energy, infrastructure development and investment promotion.

Keeping All Options – and Currencies – Open

Besides these mutually reinforcing and mutually beneficial factors, joining the BRICS is also about all these countries – members new and old – hedging their strategic choices in the global arena.

In the face of a rapidly rising China and India, and a stalling US and EU, the future of the international system is uncertain. It is – according to Josep Borrell (the EU's top diplomat) "so unstable" – or in the words of Antonio Guterres (the UN's Secretary-General) in danger of a "great fracture". Overall, as Iran's President stated in September, "the world is transitioning into a novel international order" whose final shape remains largely unknown.

Joining the BRICS is however not a wild bet that has little chance of bearing diplomatic fruit.

Apart from involving two Asian behemoths – China and India – who look set to dominate the Asian 21st Century, as well as a host of leading regional powers, the ambition of the grouping is what is its real hallmark.

The major headline here are plans by the BRICS to develop its own currency that would be truly international in nature, whereby it would not be controlled by a single country or a single nation-based central bank, or limited to a specific geographic locale.

Doing so would also hugely reduce their trade dependence upon the US dollar, euro or yen.

Such a reserve currency – potentially called the R5 or the R5+ - could mark the slow erosion of the US dollar's dominance, with one economic observer stating that "it'd be like a new union of up-and-coming discontents who, on the scale of GDP, now collectively outweigh not only the reigning hegemon, the United States, but the entire G-7 weight class put together".

It would also enhance economic integration among BRICS members and reduce any economic shockwaves emanating from the US and the West in the event of recessions or depressions.

When the next GFC-type mega-meltdown comes, the R5 would thus protect the BRICS and could be the deciding factor that signals the demise of the Global North and the Global South's rise.

Views expressed in this article are those of the author.

This article has previously appeared in German publication Makroskop

It appears here with permission and is available for republication by NZ-based media.

United States
Source: news.yahoo.com

The News

The BRICS economic bloc of countries is aggressively expanding its media presence in Africa through its Moscow-headquartered broadcast network to counter Western narratives in the Global South.

TV BRICS — which is centered on programming from member countries Brazil, Russia, China, India and South Africa — has in recent weeks signed partnership agreements with media companies in Kenya, South Africa, Egypt and Mozambique as it looks to grow the bloc's influence among some of the world's fastest-growing populations.

Ayanda Hollow, President of TV BRICS Africa, told Semafor Africa that stories from the Global South including their development, culture and human interest stories were not "well covered" by the international media establishment. He said TV BRICS was focused on bringing stories from the bloc's countries to global audiences, and not necessarily countering the viewpoints of other media outlets. "No one can tell our own stories like we can," Hollow said.

Know More


Vladimir Putin led calls for the establishment of a common TV channel for BRICS nations in 2017, saying it would help broadcast information on the group's activities. The network notes that it has a potential audience of over 3.5 billion people in member countries alone. It is owned by MKR Media, a holding company established by Russia's Interstate Corporation for Development.

TV BRICS has sealed numerous partnerships with media outlets in China, Russia and Latin America to distribute its content and also operates a 24-hour channel in Russia.

Martin's view

The media plays a big role in shaping public opinion around the world. For BRICS to succeed in its much-discussed plan to reshape the global order, it could use media outlets that can boost the images of member countries and amplify their positions on key global issues.

State-funded or state-regulated media outlets such as the British Broadcasting Corporation (BBC), Voice of America, France 24, and China's CGTN form a big part of the media landscape in Africa, and have the power to drive conversations and shape narratives. By partnering with media outlets on the continent, BRICS countries will have new outlets to presumably also grow their influence and soft power in Africa, and offer differing perspectives on global issues.

With several major Western broadcast outlets having a significant influence on news and debate across Africa, there has been pushback from some government leaders and policymakers.

"TV BRICS will have a big impact if it is perceived as providing alternate opinions to BBC and CNN," said Dr Xavier Ichani, an international relations researcher at Kenyatta University in Nairobi. He suggested that reports from those outlets are often perceived as "Western propaganda" in African countries.

Expanding BRICS' global reach is also especially relevant as the organization itself expands and is increasingly seen as a counterweight to Western-led multilateral institutions like the World Bank and International Monetary Fund. Ethiopia, Argentina, Egypt, Saudi Arabia, Iran and the United Arab Emirates are lined up to join the bloc in January 2024, and more governments in the Global South, including several from Africa, have expressed interest in joining.

Room for Disagreement

Countering the influence of Western outlets such as the BBC and VOA won't be a walk in the park for BRICS given the decades of experience and investment incumbents have put into the African market. Three African countries — Nigeria, Ghana and Kenya — count among the BBC's three largest audiences by country, with a combined audience of 63 million. In June, BBC News' top editor described the BBC as a "trusted brand" in Africa with a "deep understanding" of the continent. VOA, on the other hand, claims to reach 25 million people in Africa across radio, television, web, and social media.

The View From Johannesburg

At the launch of the Africa-focused BRICS Africa TV channel in Johannesburg in August executives said that the network would develop content in African languages including Kiswahili, isiZulu and Sepedi, to be translated for global audiences, and offer opportunities for African content producers to collaborate with producers from other BRICS nations.

African National Congress (ANC) First Deputy Secretary-General Nomvula Mokonyane said that the BRICS TV network would help accelerate implementation of the larger BRICS agenda by adding "momentum to a changing world order based on equality, mutual benefit, and reciprocal growth."