Implications of an expanded BRICS

BRICS is a grouping of Brazil, Russia, India, China and South Africa, formed by the 2010 edition of the latter to the predecessor BRIC.

On almost every scale, it would be the largest entity on the global stage other than the G20 and the United Nations. These five countries have been among the biggest and fastest-growing emerging markets since 2011.

Its genesis was when BRIC foreign ministers met in New York City in September 2006 on the sidelines of the UN General Assembly, starting a series of high-level meetings.

On June 16, 2009, they held a summit in Yekaterinburg, Russia, which marked the official establishment of BRIC.

The summit’s focus was on improving the situation where the world was reeling from the Great Recession caused by the 2008 United States’ mortgage crisis, reforming financial institutions, how the four countries could better cooperate in the future, and various ways developing countries could become more involved in global affairs.

After the 2009 summit, BRIC announced the need for a new global reserve currency, which would have to be “diverse, stable and predictable”.

Although the statement released then did not directly criticise the perceived “dominance” of the US dollar – something Russia had criticised in the past – it did spark a fall in the value of the dollar.

The original aim of BRIC was to establish a multipolar world order, and when it became BRICS in 2010, this aim was pursued with more vigour.

At its summit held in Johannesburg, South Africa, in August, six emerging economy countries (Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and United Arab Emirates) were invited to join the bloc. Their full memberships would take effect on January 1.

With the organisation gaining six new members, it would be interesting to see how the organisation will rename itself.

It could be known as BRICS Plus, BRICS+ or BRICS-11.

BRICS-11 will continue to be a colossal organisation representing nearly 40% of the global economy with a combined gross domestic product in terms of purchasing power parity of US$65 trillion (RM304.4 trillion), as compared with the share of the G7 group of advanced economies (Canada, France, Germany, Italy, Japan, the United Kingdom and the US) at around 29.9%.

Even now, with just five members, the combined GDP of BRICS was 31.5% of the world’s GDP – already more than the G7’s 29.9%.

BRICS-11 would account for nearly half of the world’s food production. In 2021, the group’s wheat harvest amounted to 49% of the globe’s total. G7’s share was 19.1%.

BRICS-11 will also have an advantage in terms of the production of metals used in the hi-tech industry. The 11 nations will account for 79% of global aluminium output, against just 1.3% controlled by the G7. For palladium, the disparity is 77% for BRICS-11 versus 6.9% for the G7.

The expanded BRICS will also account for roughly 38.3% of the globe’s industrial production, versus 30.5% for the G7. However, the latter will retain the advantage in terms of exports, with a share of 28.8% against 23.4% for BRICS-11.

Saudi Arabia has the largest economy among the new BRICS members. Its GDP in dollar terms at the end of 2022 was estimated at US$1.1 trillion.

But the UAE would also be a formidable addition to the bloc thanks to its status as a major exporter. Its 2022 goods exports amounted to nearly US$600 billion.

Overall, BRICS-11 would account for 48.5 million sq km, representing 36% of the world’s land mass. This is more than double that of the G7. The combined population will amount to 3.6 billion, 45% of the globe’s total, more than four times more than the G7.

And the expanded BRICS is expected to dominate global energy markets as it will soon control nearly half of the world’s total oil output – 719.5 billion barrels out of 1.6 trillion. In comparison, the G7 group of leading economies controls only 3.9% of known crude reserves.

While BRICS has had many admirers, judging from the more than 40 countries interested in joining the bloc, there were many detractors especially from the west, which were sidelining Russia for its invasion of Ukraine.

When the six new BRICS members were announced, questions were raised on why countries like Indonesia, Argentina and Mexico were not invited into the bloc.

Enlargement is hardly compatible with full-fledged institutionalisation as it would be too complicated.

Just look at how Turkey and Serbia had to wait so long to be absorbed into the European Union when newcomer Ukraine, which is the darling of the west and despite being well known as a country with rampant corruption, seemed to have been given a priority in the accession process.

But success is not guaranteed, as enlargement may lead to the automatic addition of new countries on a formal principle. But in general, the soft separation of the West and the rest of the world is an objective process for the coming years.

Isn’t this the height of simplicity? This will just make the popularity of the BRICS franchise grow, heralding the dawn of a new era where more people will have greater say in asserting and managing their own destiny, in their own country, free from the clutches and interference of a meddling sole superpower in a unipolar world. – September 17, 2023.

* Jamari Mohtar reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.

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