An Analysis of the BRICS 15th Summit

An Analysis of the BRICS 15th Summit | Daily Writeups | Opinions

The following article, “An Analysis of the BRICS 15th Summit”, is written by Syeda Sonia Haider, a student of Sir Syed Kazim Ali. Moreover, the article is written on the same pattern, taught by Sir to his students, scoring the highest marks in compulsory subjects for years. Sir Kazim has uploaded his students’ solved past paper questions so other thousands of aspirants can understand how to crack a topic or question, how to write relevantly, what coherence is, and how to include and connect ideas, opinions, and suggestions to score the maximum.

Outline

1-Introduction

2-What BRICS is: An Overview

3-What has BRICS achieved so far?

• ✓New Development Bank
• ✓Contingency Reserve Arrangement
• ✓Cultural Exchange Programs

4-Role of BRICS in the Contemporary Global Order

• ✓Voice equal to G-7 Countries
• ✓17% Global Trade and 32.1 % Global GDP
• ✓90% of Oil Exporters, the new members
• ✓Diplomatic Influence: no response on Russia-Ukraine war

5-Challenges and Concerns of the BRICS

• ✓America’s Influence
• ✓Challenge of Expansion
• ✓Challenges to Consensus Building
• ✓India, being the United States (US) ally, is a reliable partner of other members

6-An Analysis of the 15^th Summit: Agenda and Discussions

• ✓New Multipolar World Order
• ✓Anti-Western New Members: A Shift in Power Dynamics
• ✓Trading in National Currencies: India-UAE Oil Deal in Rupee
• ✓De-dollarization: Trading in Yuan

7-Future Expectations of the Member States from BRICS

• ✓Economic
• ✓Political
• ✓Social

8-An Epilogue

Answer to the Question

Introduction

The 15th Summit of BRICS, held in Johannesburg, South Africa, from 22nd to 24th August 2023, has brought together the leaders of Brazil, Russia, India, China, and South Africa to deliberate on crucial issues shaping global dynamics. As a platform for emerging economies of 32.1% global GDP, having a voice equal to G-7 countries, and a block of 90% oil exporters, BRICS has increasingly become influential, driving discussions on economic cooperation, geopolitical stability, and sustainable development.  Against the backdrop of a rapidly changing global landscape, the summit has addressed pressing challenges, such as economic cooperation, mitigation of geopolitical tensions, and expanding the consortium, acquiring the status of an influential platform for Global South to discuss their social, political, and economic issues. The analysis of the summit, however, entails a shift in power dynamics, a new multipolar world order, and de-dollarization, further raising the future expectations of the member states from the block stakeholders’ community. The article, therefore, explores the role of BRICS in shaping international relations, the challenges it faces, and expectations in the future from the block. The analysis also aims to provide insights into the 15th BRICS Summit’s significance in navigating the complex challenges of the contemporary world.

What BRICS is: An Overview

Explaining the block’s standing, an economist, Jim O’Neill, coined the term BRIC for the first time in 2001, believing that Brazil, Russia, India and China- the organisation’s founders- would dominate the global economy by 2050. They were expected to be the world’s foremost provider of manufactured products, services, and raw resources by 2050. Later, South Africa was added in 2010 and became BRICS. The organisation aims to create cooperation among member states and promote trade and development across regional countries. It was, therefore, formed to improve the economies of these nations and the global socio-economic situation at large. In this way, BRICS sees itself as countering the traditional Western-led global order, with some member states viewing the organisation as a way to boost their international influence. As quoted by Xi Jinping at one of the BRICS summits,

“Development is an inalienable right of all countries, not a privilege of a few.”

What has BRICS achieved so far?

Since its inception, the BRICS has made notable strides to offer an alternative to traditional financial and political systems. One of its significant achievements lies in fostering economic cooperation among its member states and representing the Global South despite its members belonging to different cultures, languages, and interests. Furthermore, establishing the New Development Bank or the BRICS bank, a multilateral development bank with $50 billion (€45.6 billion) in subscribed capital to fund infrastructure and climate-related projects in developing countries, has been considered a notable development of the consortium. The bank has approved over $30 billion in loans and $8 billion in renewable energy and infrastructure since its inception in 2014. Moreover, another milestone that BRICS has achieved is creating a $100 billion Contingency Reserve Arrangement, a foreign currency liquidity facility that the members can tap into during any global financial turmoil. Similarly, in cultural exchange programmes, the BRICS Film Festival held in Chengdu, China, in 2017, some Indian films like “Baahubali: The Beginning” and “Turtle” won big, both critically and financially in the Chinese market, making BRICS an organisation promoting cooperation not only through government-owned institutions, but by civil society and people-to-people interactions in areas of culture, art, and education. Therefore, despite the divergent and convergent interests of five member states belonging to four continents, BRICS has achieved trust on technical, political, economic and cultural fronts.

Importance of BRICS in a Contemporary World

Regarding its importance, the BRICS has positioned itself as a geopolitical alternative to a US-led world order and a sincere representative of the Global South, thus making itself a worthy group with a voice equal to G-7 countries. In this way, the BRICS community plays a critical role in setting global economic policy and promoting financial stability. It accounts for 17% of international trade and 32.1% of global GDP, surpassing G-7 countries’ combined GDP share worldwide. Representing over 40% of the world’s population and contributing substantially to global GDP allow BRICS nations to shape international trade, investment, and financial policies, fostering a multipolar world order. Moreover, with Iran, Saudi Arabia, UAE, Egypt and others more likely to join the consortium after the 15^th summit, BRICS now consists of countries that control 90% of the oil export. The expansion, ultimately, grants this block a greater weight in international affairs. Furthermore, the diplomatic influence of BRICS has left the Western world in shock when, in a recent summit, none of the member states seemed willing to denounce Russia’s behaviour in the Russia-Ukraine war, consequently influencing global affairs more powerfully and independently. In the same way, BRICS has become a platform for the southern economies to obtain loans and supportive investments for small projects without harsh lending conditions as of the International Monetary Fund (IMF) and World Bank (WB). In essence, BRICS possesses the diplomatic, political, and economic strength to influence international relations, if not reshape them entirely, diverging from the perspectives of the Western world. As Narendra Modi himself says in one of the BRICS Summits:

“Today, we are an influential voice for the world’s emerging economies.”

Challenges and Concerns of the BRICS

Despite many common interests, the BRICS alliance faces various challenges and concerns as it navigates the complexities of global geopolitics. Geopolitical tensions and differing political ideologies of five member states belonging to four continents within the alliance pose a continuous challenge as the member countries strive to find common ground on various international issues. A primary challenge involves the influence of American pressure to prevent candidate countries from aligning with a group that doesn’t adhere to Western economic systems and interests. This becomes particularly pronounced when a nation is caught between Western and anti-Western perspectives. For instance, Turkey, seeking BRICS membership, faces complexities due to its NATO affiliation, raising questions about the convergence of views upon acceptance into the alliance.

Moreover, despite proposing an alternative to the Western-dominated international financial system, BRICS countries exhibit divergent interests within the group, as in the case of expansion of the group in the 15^th summit, for the expansion benefits significant players like Russia and China, other nations, such as India and Brazil may encounter challenges, as they embrace countries perceived as ‘Anti-West’ within the bloc. In this way, the increasing scepticism about BRICS, which stems from profound differences among member countries, can impede its progress and hinder the formation of a cohesive identity.

Furthermore, the expansion of BRICS introduces additional challenges to the existing consensus-based decision-making within the group. For instance, for India and Brazil, the expansion diminishes their influence in the bloc, posing a challenge to their non-aligned foreign policies. However, Russia and China view this expansion as a significant counterbalance to the Western-led G-7, provoking new conflicts between member states.

Similarly, BRICS’s key members, China and Russia, have consistently advocated for adjustments and reforms in the ‘Neo-liberal’ world order to facilitate a fair and democratic shift towards multipolarity. In contrast, India, being an active, strategic ally of the U.S. and engaging in multi-alignments aimed at countering China, appears to be the odd one out. Amidst these diverse alignments, a pertinent question emerges: Can India establish itself as a reliable partner in multilateral forums dominated by China and Russia, as these nations actively pursue the creation of a post-Western world order? Such differences can obstruct its progression into a cohesive identity. In summary, BRICS faces challenges ranging from economic inequalities and geopolitical tensions to varying political systems. Successfully addressing these issues will depend on the adept diplomatic manoeuvring of the BRICS nations and will ultimately shape their collective impact on the global stage. However, the BRICS itself thinks in this way:

“Nothing can separate people with common goals and ideals, not even mountains and seas.” We, the five BRICS countries, come from four different continents. The grand goal of fostering partnership for joint development and the noble cause of promoting democracy in international relations and advancing peace and development of humanity has brought us together.”

~President Xi Jinping

An Analysis of the 15^th Summit of BRICS

Analysing the block’s recent meeting, the BRICS 15^th Annual Leaders’ Summit focuses on political, technical, and socioeconomic coordination in which member countries have identified business opportunities, economic complementarities, and areas of cooperation. South Africa, being the host member state, stresses the theme, ‘BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development, and Inclusive Multilateralism’, showing its dedication and commitment to the joint development goals in the block. The 15th BRICS summit, further modernising and galvanising the group, has sent a strong signal that the post–World War II order should accept the multipolar reality and change with the times. Furthermore, the transformation of BRICS into a BRICS+ format, accompanied by establishing guiding principles, standards, and procedures, has likely enhanced the appeal of BRICS as an attractive institution for consensus-building and dialogue in the developing world. Thus, the inclusion of new members in the BRICS, with profiles different from traditionally deemed “Acceptable” partners by the West, suggests a shift in the system’s dynamics. The presence of Iran, particularly, and its subsequent reactions in the days ahead will be engaging.

Another crucial aspect of the 15^th summit is the members’ engagement with the new cooperation systems that BRICS has been working to establish- a shift towards trading in national currencies. The recent oil transaction designated in rupees between India and the United Arab Emirates has challenged the petrodollar agreement of 1973, an agreement between the U.S. and Saudi Arabia to make oil deals only in dollars, significantly lessening the dependence on the dollar. This de-dollarization seems crucial to BRICS members in reshaping the future of international trade and cooperation. That is why Russian President Vladimir Putin stated at the summit that “De-dollarization is irreversible within this block and is gaining momentum.” Currently, China and Saudi Arabia have been exploring options for conducting their oil trade in yuan, substantially moving towards reducing the dollar’s dominance in the oil trade. The discussions on de-dollarization possibilities have included the proposal of establishing a shared currency, which emerged as a prominent point of debate. Therefore, the summit is undeniably an endeavour towards an alternative world order that listens more sympathetically to the developing many rather than the developed few.

Future Expectations of Member States from BRICS

Further, the future expectations of BRICS members revolve around solidifying the bloc’s position as a formidable player in global affairs. With a shared ambition to reshape the world order, BRICS nations anticipate enhanced economic, political, technical, and strategic collaboration. The expectations from the block are written hereunder.

• Economic Expectations

The BRICS countries are anticipated to continue driving global economic growth, contributing significantly to the world’s GDP. Major players, such as China and Russia, aspire to diversify their partnerships further, promote technological innovation, and bolster trade using their national currencies, reducing dependency on petrodollars. Moreover, China exemplifies this with its Belt and Road Initiative by fostering infrastructure development in participating countries and promoting economic interdependence. In the same way, India’s robust IT sector, “Made in India” policy and entrepreneurial spirit showcase its potential for innovation and technological advancements. Brazil and Russia, rich in natural resources, play crucial roles in global commodities markets. South Africa contributes to the group’s economic diversity with its mining and industrial sector. Collectively, increased intra-BRICS trade and collaborative projects, such as the New Development Bank and Contingency Reserve Arrangement, demonstrate their commitment to fostering economic resilience and sustainable development. Furthermore, with six out of the world’s top ten oil producers joining the block, BRICS members have been planning to exert influence over global energy dynamics. Therefore, the block has proven itself a solid economic platform for the Southern block.

• Political Expectations

The BRICS nations are expected to challenge traditional power dynamics, promoting a more multipolar world. Through diplomatic efforts, these countries aim to reshape global governance structures. In the political realm, the expectation is to strengthen the unity within the group, navigate geopolitical challenges, and collectively assert their interests in multilateral forums. For instance, China’s Belt and Road Initiative involves political and diplomatic ties across Asia, the Middle East and Africa, challenging the dominance of Western-led institutions. Moreover, BRICS collectively will advocate for a fairer representation in international organisations like the United Nations, showcasing a commitment to a more equitable distribution of political influence. Collaborative efforts in addressing geopolitical issues, such as the Iran nuclear deal or conflicts in the Middle East, underline the BRICS nations’ aspiration to be critical players in shaping global political discourse. Ultimately, the future expectations of BRICS members hinge on forging a cohesive identity that amplifies their collective influence, fostering a more balanced and multipolar global order.

• Social Expectations

Socially, the BRICS group is expected to prioritise inclusive development, reducing inequality, and improving living standards. China’s poverty alleviation initiatives have lifted millions out of poverty and exemplify a commitment to social progress. Moreover, India’s emphasis on financial inclusion through programs like Jan Dhan Yojana aims to empower marginalised communities socially. Furthermore, Brazil plans to focus on social welfare programs to support small communities, while Russia’s efforts include state-wide healthcare reforms. South Africa’s commitment to addressing historical inequalities is seen in affirmative action policies. To cut short, the BRICS nations are expected to continue collaborating on social issues, such as public health, education, and poverty eradication, showcasing a collective dedication to improving the quality of life for their citizens and beyond.

An Epilogue

Conclusively, the BRICS- a group of the world’s most populated and rising economies: China, Russia, India, Brazil, and South Africa- since its inception, has been serving as a global platform of collaboration in trade, business, development and diplomacy outside of the Western world. Despite different and, sometimes, competing interests, BRICS members serve a more significant role- an alternative to the Western financial and political system. Therefore, BRICS, representing the interests of the Global South, navigates its members’ divergent and convergent interests, making BRICS a multidimensional platform advancing every member’s agenda by and large. As we reflect on the 15th summit, it becomes evident that BRICS plays a pivotal role in shaping the international agenda, contributing to de-dollarization and proposing a more equitable global order. However, facing particular challenges, the block not only serves as a platform for dialogue but also reaffirms the potential for these emerging economies to drive positive change on a global scale. As emphasized by South African President Cyril Ramaphosa during the August BRICS Summit,

“BRICS is an equal partnership of countries with differing views but a shared vision for a better world.”

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