The BRICS are back, but for what purpose?

Back in the 1960s, General Charles de Gaulle quipped about Brazil’s economy: “Brazil is the country of the future and always will be.” He was referring to those countries that seem to have all the resources and ingredients for success but nonetheless repeatedly fail through inadequate leadership, unsound policies or weak institutions to translate that potential into real performance.

In recent times, the same could be said of the BRICS, the grouping that brings together Brazil, Russia, India, China and South Africa. The term BRICs was coined by Jim O’Neill, then the chief economist at Goldman Sachs, back in 2001 although the informal club itself only burst onto the scene in 2009. South Africa joined a year later turning the small ‘s’ in the original BRICs into the large ‘S’ of the current BRICS. This new group supposedly represented the major emerging economies that were rapidly modernising and opening up for investment, trade and the inter-dependencies created by globalisation. So, their faster rates of economic growth and investment would in turn drive global economic growth and allow the mature industrialised economies of the West to recover more quickly from the banking and sub-prime lending crisis triggered by the collapse of Lehman Brothers in 2008.

Yet, in the decade and a half since its creation, the BRICS has failed to be a major player on the global diplomatic or economic scene. Its summits have been frequent but largely inconsequential, condemning the West with many a rhetorical flourish but producing little of lasting or concrete value. Unlike other new institutional creations, such as the Association of Southeast Asian Nations (ASEAN), the G20 or the African Union, it has not developed a permanent bureaucracy, a steering structure nor a clear agenda. No further countries have joined since South Africa in 2010. The five BRICS members, notably India and China, have had as many divergences as agreements on key international issues, and whereas Russia and China have been keen to use the BRICS to score geopolitical points in their increasing rivalry with the United States and the European Union, the other three have been more interested in using the BRICS mechanism to secure economic benefits, such as trade in local currencies outside the dollar zone, a New Development Bank (NDB) to tap the bond market and foreign investment with fewer strings attached.

 All five have also devoted more time to promoting regional economic integration – for instance, China with its Asian Infrastructure Investment Bank and Shanghai Cooperation Organization, Russia with its Eurasian Economic Union, Brazil with Mercosur or South Africa with the Southern Africa Development Community – than to developing the BRICS as a serious competitor to the G7 or G20. The five have also lost their earlier image of economic tigers and aspirational models, with the possible exception of India. Their growth rates have slowed considerably. On average, they have been less than 1% annually for Russia, Brazil and South Africa, and around 6% for China and India since 2013.

Russia has been mired in sanctions since its invasion of Ukraine in February 2021. The rouble has lost nearly 30% of its value against the US dollar and in late August the Russian space agency, Roscosmos, suffered the humiliation of seeing its lunar spacecraft, Luna 25, crash into the surface of the moon after a technical malfunction. This cast doubts as to Russia’s capacity to remain a major player in space exploration, an area in which the Soviet Union was once able to lead and challenge the mighty US. To rub salt into Moscow’s wounds, two days after the crash of Luna 25, India landed its space probe, Chandrayaan 2, on the Moon’s south pole in a flawless technical manoeuvre. China has also been experiencing a sharp decline in growth and endemic inflation. In late August, its largest property developer, Evergrande, filed for bankruptcy and Beijing suppressed a report indicating a rise in unemployment among 16- to 30-year-olds to just under 30%. This prompted the US National Security Advisor, Jake Sullivan, to warn Beijing of the consequences for foreign investor confidence of a failure to publish accurate and reliable economic statistics.

Brazil has continued to face massive economic inequality and rising poverty levels, as has South Africa, where the inability of the state electricity company, ESKOM, to keep the lights on in Johannesburg and Cape Town for more than a few hours every day has dealt a massive blow to economic productivity. Boasts that the BRICS would ‘de-dollarise’ the global economy, establish a rival BRICS currency and become a finance lending and development powerhouse as an alternative to the World Bank and IMF have rung hollow. “Reports of my demise are greatly exaggerated,” said Mark Twain. The same could be said of the repeated predictions regarding the imminent demise of the dollar as the global trading currency.

Yet, despite these setbacks and economic fragilities, the BRICS have launched a serious makeover and comeback. Its 15th gathering in Johannesburg on 22-24 August generated much greater media attention and commentary than any of its previous meetings. In part this was due to the summit’s build-up when media attention focused on whether Russia’s leader, Vladimir Putin, would show up in person in Johannesburg, thereby putting pressure on his host, the South African government, to arrest him on an indictment for war crimes issued by the International Criminal Court (ICC) in The Hague. Russia is not a party to the Rome Statute, which established the ICC, but South Africa is – a fact that would have put it under a legal obligation to arrest the Russian leader and hand him over to the jurisdiction of the Court. In the end, Putin saved his hosts this embarrassment by deciding to stay in Moscow and despatched Russian Foreign Minister, Sergei Lavrov, to replace him at the BRICS summit. Instead, Putin delivered his 17-minute speech via video conference. Yet, the Putin episode immediately placed the BRICS meeting in the shadow of the war in Ukraine and the widening divide that it has revealed between the West, invoking the international rules-based order and pushing back against Russia’s aggression, and low- and middle-income countries (LMICs), which have tended to view the war as a regional rather than a global conflict and one which only concerns them because of the disruption that it has inflicted on their economies and food and energy supplies.

Indeed, many LMICs have interpreted the war in Ukraine as an effort by the West to impose its norms and security interests on the rest of the world through the imposition of severe sanctions on Russia, as well as other countries such as Iran or Belarus. The West has also put pressure on LMICs to align themselves with its positions against Russia and impose sanctions on Moscow – something that these countries perceive as serving the West’s interests rather than their own. Hence the talk in Johannesburg was much about greater equality and fairness in the international system. Indian diplomats spoke of ‘strategic autonomy’ or a new world order based on ‘multiple alignment’. President Lula da Silva of Brazil spoke of the BRICS as “a force for fairness in international relations”. In a clear dig at the US, the speech of President Xi of China referred to “some country, obsessed with maintaining its hegemony, has gone out of its way to cripple the emerging markets, and developing countries.”

Putin certainly attempted to seize on the anti-Western mood and to use the BRICS meeting to show that Russia has friends and to put all the blame for the current geopolitical tensions on the West. Putin noted that it was “the desire of some countries to maintain [their] hegemony in the world, that led to the severe crisis in Ukraine.” He attempted to play down the impact of Russia’s exit in late July from the Black Sea grain deal and Moscow’s deliberate attacks on Ukraine’s port infrastructure and grain silos, by asserting that Russia could make up for the reduced exports of Ukrainian grain and offer free grain to 20 of the most ‘needy’ countries in Africa. Putin suggested too that Russia would build a series of ports and transport links along the Arctic coastline and from Russia to the Gulf and Africa in order to break Western control over global shipping and communication routes and to foster a new, international trading infrastructure managed by the BRICS themselves. There were also offers to write off African debt, but only to the tune of $90mn in the case of Russia, and to help African countries gain compensation for the depredations of Western colonialism. Behind the Russian diplomacy is a clear sense – also shared by Beijing – that influence is based on numbers and mass. Just as the West has used the Ukraine war to pull together and strengthen its institutions – for instance, Finland and Sweden joining NATO, the G7 reinvigorating its role and the EU offering membership perspectives to Ukraine and Moldova – so the camp seeking to present itself as the political and ideological opposition also needs to big up through expansion and a more structured organisation. As Lula put it: “We just want to organise ourselves.”

This meant that the dominant topic of the BRICS in Johannesburg was whether, but in truth also when and how, to enlarge its membership. Twenty-two aspirant countries are waiting in the wings and according to Cyril Ramaphosa, the South African President, twenty more have expressed an interest in joining. China and Russia have been the most enthusiastic about expanding the BRICS as a tool to increase their global leadership role and influence. Brazil, India and South Africa have been less keen. As smaller powers in a new world order of multiple and newly assertive medium-sized countries, they fear a dilution of their role and influence. Yet, they nonetheless went along with a decision in principle in Johannesburg to enlarge the bloc and issued a first set of invitations.

The BRICS now need to sort out what are the criteria and timelines for selecting new members and who should be invited to join first. In a prefiguration of what the BRICS could look like in the future, Ramaphosa invited a number of other leaders from Africa and beyond to meet with the BRICS leaders at a business forum and other side events. Saudi Arabia, which has heaved away from the West and towards China and Russia in recent times, has long been first in line to join the club. China brokered a normalisation of diplomatic relations between Riyadh and Tehran, and Beijing has become the largest importer of Saudi oil. Saudi Arabia’s entry into the BRICS would give the grouping representation from the Gulf region in addition to Asia, Europe, Latin America and Africa. Although not a fan of enlargement, Brazil insists that if the BRICS doors are opening then Argentina be invited to join too.

Meanwhile, South Africa, although for long enjoying its exclusivity as the only African member, is now pushing for more African countries to be included. Nigeria, Algeria, Egypt and Kenya have been obvious candidates and African frustrations regarding the roll-out of COVID-19 vaccines, food, energy and supply chain disruptions due to the war in Ukraine, as well as flagging Western interest in resolving the continent’s multiple domestic conflicts, lie behind much of the current disaffection of LMICS in the southern hemisphere for its northern neighbours. The BRICS is an attractive forum for Africans seeking to raise their voice and identify on the global stage at a time when the continent has no permanent seat on the United Nations Security Council and only one member (South Africa) of the G20. Certainly, as a bloc of significant countries, many of which are still on the margins of the global diplomatic and economic order, the BRICS has to command attention. Even with its current five members, it represents 40% of the global population and a quarter of global GDP. The BRICS share of the global economy has increased from 8% in 2001 to 26% today, while the share of the G7 countries has fallen from 65% to 43%. These statistics somewhat undercut the BRICS narrative of a malignant West holding back the development of all its competitors.

Yet, it is questionable whether simply expanding the BRICS will in itself make the body more powerful on the geopolitical stage or more meaningful to its members. As The Economist put it: “Is a bigger party a better one?” Anti-Western sentiment and feelings of victimhood alone may not be a sufficient glue to bind the group together or to make the BRICS into a coherent organisation able to deliver for its poorer members in particular. Already with five members, the BRICS is a more heterogeneous group than the G7, and divisions and conflicting priorities will most probably increase as the group becomes larger. The presidents of India and Brazil have recently had highly visible and successful visits to Washington, signing a host of new bilateral agreements, particularly in the fields of science, technology, defence systems, aviation and space exploration. India is a member of the US-led QUAD in the Indo-Pacific and regularly participates in military exercises in the region together with Japan, Australia and the US.

In Johannesburg, Lula in particular stressed that he did not want the BRICS to become a rival to the G7 or the G20 or indeed the US, in marked contrast to Putin who seemed content to use the BRICS as a club (in both senses of the term) to bash the West, Lula warned that making fiery speeches was all very well but that the BRICS would serve little purpose as a modern-day “Tower of Babel”. He also, like Putin, took up the theme of the war in Ukraine but to insist that the sovereignty and territorial integrity of countries had to be preserved as well as the principles of the United Nations. Again, this was hardly the same message as Putin.

Certainly, in the short term, an expansion of the BRICS will convey a sense of momentum and oblige the West to take this grouping more seriously than it has done in the past. Yet countries that have viewed the BRICS as a refuge from the ‘hegemony’ of the West and as a means to increase their voice on the global stage may in due course be reluctant to submit to the hegemony of Russia and China, and become cheerleaders for Moscow and Beijing in their confrontations with the US and the EU. With Iran and Venezuela also seeking to join the BRICS, the body could evolve into a club of authoritarians, covering up human rights abuses, turning a blind eye to poor governance and corruption, and condoning aggression as increasingly a Communist Cold War type of ideological conformity is imposed on its members in return for economic benefits. Such an evolution would only give succour to those in the West who have defined international relations as a contest between democracies and authoritarians – an overly simplistic and black-and-white view of the world that, paradoxically, many of those medium-sized countries seeking to join the BRICS have criticised.

Whatever the ultimate utility of West-bashing, the current and future members of the BRICS will use the leaders’ summits and other BRICS formats, like foreign ministers’ meetings, to try to score their geopolitical points and attract political and media attention. After all, this is the name of the game in modern international diplomacy. But if the BRICS is to be more than a public platform or echo chamber, it needs also to have an action plan and a set of achievable and measurable goals. Simply to be against the West – or not the West – is not sufficient. It has to develop an agenda of its own. The added value of BRICS has to be more than the mere sum total of its member states. So, what concrete purpose could it serve?

One idea, much favoured by Lula, is for the BRICS to elaborate its own diplomatic initiatives. He proposed a peace plan for Ukraine, which most probably involved BRICS backing for his own individual peace mediation efforts during visits to Kyiv and Moscow in the spring. The problem here is that there are already multiple Ukraine peace initiatives on the table, notably the 12-point plan proposed by President Zelensky himself for which he is seeking the organisation of a UN-sponsored international conference. Türkiye organised talks in Istanbul soon after Russia’s invasion and Zelensky travelled to Saudi Arabia in the spring for the launch of an effort by the Gulf countries. The African Union sent a high-level group, led by Ramaphosa and including four other African leaders, to Kyiv and Moscow. Even Indonesia has tried to mediate and China has appointed its own special envoy to shuttle between Kyiv and Moscow. Given this plethora of peace initiatives, it seems doubtful that a BRICS peace plan will offer any added advantage. So better to concentrate on other conflicts where the UN or regional organisations like the African Union could do with some outside help and political pressure.

Yemen, where the Saudis have recently been seeking to de-escalate and the Iranians are in a more flexible mood, is one possibility. Syria, where the humanitarian situation remains dire and fighting between the Syrian army and local jihadists has flared up again, is another. Africa is tragically studded with conflicts, many of which as in the Democratic Republic of Congo, Somalia or Sudan have become endemic. Yet will the BRICS be capable of doing anything useful here? Saudi Arabia has tried to negotiate ceasefires in the current fighting between army factions in Sudan but with the US rather than Russia or China. Russia in particular benefits from conflicts in Africa through supporting military coups and using its Wagner mercenaries to exploit mining and mineral resources. Russia’s interest in now inserting its Wagner forces into Niger following the military coup there last July hardly suggests that the BRICS will support the efforts of the Economic Community of West African States (ECOWAS) and the African Union to return Niger to the constitutional rule of the deposed President Mohamed Bazoum. As the revenues from propping up military regimes or military insurgents in the Sahel and elsewhere become more useful to help Moscow finance its war in Ukraine, Russia has little interest in peace settlements that would reduce the demand for its security services or diplomatic support. Post-conflict reconstruction has always been largely a Western effort to which the Russians (and Chinese) have contributed little. Some BRICS members are involved in territorial disputes of their own, such as India and China in Arunachal Pradesh and on the Himalayan Plateau. They are hardly likely to welcome BRICS mediation efforts that could privilege one side against the other.

That leaves the economic domain. The NDB is looking to Chinese capital to finance loans and bond emissions. The bank has already launched a rupee bond for $2.5bn and is now planning a rand emission. China is by far the economic powerhouse of the BRICS. In 2001, its proportion of the group’s output was 47% and this has grown to 70% today. It now makes up 69% of all the intra-bloc trade, up from 55% in 2001. The Chinese economy is 40 times larger than that of South Africa, which is itself the largest economy on the African continent. So, much of the financial offering of the BRICS will depend on how generous Beijing will be in loosening its purse strings and how much self-interest it will perceive in developing further trade and investments with the bloc. The question here is that the BRICS can certainly widen, but can it also deepen?

A Contingent Reserve Arrangement was established in 2014 to provide hard currency swap lines between central banks if BRIC members experience balance of payments problems but it has yet to be used. The NDB, established in 2015, has been more active, lending €33bn thus far to help finance 100 projects. Yet this is only one-third of what the World Bank committed in 2021 alone. Moreover, the NDB’s loans were in dollars and euros, which contradicts the BRICS’ oft-stated intention to dethrone the dollar. The bank is open to non-BRICS members, and Bangladesh, Egypt and the United Arab Emirates (UAE) have joined it in the past three years. Uruguay has applied for membership too. Some in the BRICS have spoken of the bank becoming a rival to the World Bank. Yet China has a major share of the voting rights – 40% in the Contingent Reserve Arrangement, for instance – and has insisted on financial limits on individual loans. The five original BRICS members also share 55% of the voting rights of the NDB. This does not make it any more democratic than the much-criticised World Bank or the International Monetary Fund (IMF). Meanwhile, plans for a common BRICS currency have come up against objections from central banks that they would lose their autonomy. There are also fears that a common currency would crash on launch, discrediting the whole BRICS enterprise.

The BRICS ended their summit in Johannesburg by agreeing to admit six new members: Iran, Egypt, the UAE, Argentina, Ethiopia and Saudi Arabia. Obviously, this will necessitate a change in the name of the grouping to reflect all these new initial capital letters. Finding a catchy acronym to replace BRICS will not be easy. At least if Kenya alone had joined it would have produced BRICKS. But more seriously this significant enlargement will oblige the West to sit up and pay more attention. The membership of Egypt and Ethiopia with over 100mn inhabitants each will further boost the BRICS share of the world’s population; the G7 only makes up 10%. The UAE and Saudi Arabia have enormously increased their profile on the world stage, the first by hosting the COP28 climate change conference this November and the second by becoming a major sponsor of major sports leagues. These two Gulf countries used to be firm allies of the US and the West. In addition to its annual summits, the new BRICS will also become a more significant international network. It is planning more regular meetings of foreign and other ministers, a youth summit and more academic and university links. So how should the US, the EU and the classical West as embodied in the G7 respond?

First by recognising that the new BRICS is yet another manifestation of the more complex multilateral and indeed multi-alignment world in which we live today. The emerging medium-sized powers seek to pursue their own interests and pursue multiple relationships as they define their immediate economic interests. They do not want to be tied to ideologies nor to one camp at the expense of the other in the way that the Cold War imposed inflexible alignments and disciplined bloc memberships upon them. This pragmatism is a challenge for Western countries that define their international relations around notions such as respect for democracy, human rights, good governance and the rules-based global order. It implies moving to a less values-based and more transactional set of foreign policies.

There are opportunities for the West here too in demonstrating that what it has to offer is ultimately much better geared to the long-term interests of the new and aspiring BRICS members than what the group comes up with by itself. Hence the importance of current efforts by the Biden administration to recapitalise the World Bank and the IMF where it is seeking the approval of Congress. A World Bank with an expanded mandate to invest in projects supporting the green energy transition, smart grids, environmentally sound mineral extraction and adaptation to climate change, as well as to develop long-term partnerships and investor relationships with its client countries, would be a serious competition to the NDB. It could compete better too with other regional infrastructure banks that might not have the same standards when it comes to defining sound project evaluation, quality execution, long-term social and economic benefits and a good return on investment. Similar efforts by the G7, the US and the EU with their Global Gateway initiatives can help by providing readily accessible capital and expert technical support. So, the core approach of the US and EU should be to scrutinise carefully what the BRICS actually does and keep a scorecard of what its projects and programmes achieve and deliver vis-à-vis the stated ambitions, alternative projects and sources of funding. The populations and media of the BRICS countries need to have this information. It all sounds good, but what are you actually getting in practice?

A second leg of the strategy is to expand the role of the emerging LMICs in the existing international institutions rather than see their place primarily in new regional structures, for instance, Africans in the African Union. There is no representative of Africa, Latin America or the Gulf among the permanent members of the UN Security Council. South Africa is the only African state in the G20, despite the fact that Africa today makes up one-third of the world’s population. The IMF has consistently refused to move to appoint more Africans to its board of governors. This issue of equitable global power-sharing has long proved to be a vexatious one. Countries long entrenched in prestigious and powerful international positions do not give them up easily. But now is the time more than ever for the post-war global institutions built around the UN to engage in some serious institutional reform. It can give the emerging LMICs less scope for criticism from the sidelines and a greater stake and responsibility in upholding the rules-based order.

A third priority is for the West to focus intensely on building its relations with major LMICs that are more open to Western influence and persuasion. India and Brazil have been mentioned in this context already. Lula has shown himself to be a guardian of the global interest by halting illegal logging in the Amazon rainforest and recently held a meeting of the Amazon countries to stop the further deforestation of this region that is vital to the planet’s ecosystem. India needs the West for its markets, security and access to its universities and science and technology institutions. It recently signed an agreement with Washington to buy US jet engines and technology. South Africa, although leaning more towards Russia and China in recent times, still has a free press and a vibrant opposition, as well as a need for massive foreign investments if it is to solve its gaping social and employment problems. South Africa too has a preferential trade agreement with the US that it can ill afford to see the US Congress rescind if it draws too close to Russia and China. Türkiye is a member of NATO and has recently revived its interest in one day joining the EU. The charismatic leaders of these countries will not miss an opportunity to criticise the West to keep their political base happy, but they will not have an interest in the BRICS turning into a ‘bash the West’ club that forces them to take a more confrontational stance towards their key Western partners. The US and EU will need to develop big ears and tough skin.

Finally, the West must avoid a self-fulfilling prophecy of viewing the BRICS as henceforth the ‘official opposition’, along the lines of the Warsaw Pact to NATO or the Spectre crime organisation to James Bond’s MI6. It would be tempting to do so and much of the current Russian and Chinese denunciations of the West and calls for a fairer international order seem to accredit this interpretation. But it would be a grave mistake, play into the Moscow narrative and only give the BRICS a sense of identity and purpose that it currently lacks. So, publicly at least, the Western approach should be to avoid either over- or underreacting and treat the new BRICS with interest and respect. It should then give its own interpretation of how this bloc can best serve the interests of the global economy and peaceful conflict resolution, as well as promote jobs, health, education, public security and development among the poorest members. Once again, the messaging should be directed as much at the local populations as at the BRICS member governments. The West could then state how its own members and institutions look forward to working closely with the BRICS countries to achieve these goals and to monitor their progress.

Yet, the West needs to make abundantly clear that the enlarged or new BRICS structures and ambitions will not give the BRICS members extra protection if they commit human rights abuses, manipulate elections, launch military coups against legitimately elected governments, indulge in massive corruption, wreck their economies through state capture or act aggressively towards their neighbours and the broader international community. The universal norms of the UN Charter and international law still apply. As does the requirement for firm Western responses.

The BRICS summit in Johannesburg certainly captured the media’s attention and the South African government will no doubt be congratulating itself for a big diplomatic success, which has put the country on the map and distracted attention – at least for a few days – from the usual domestic agenda of ESKOM’s power cuts, youth unemployment and the indulgence of the legal system for the corruption and profiteering of the ruling ANC (African National Congress) elite. With new members, multiple aspirants knocking on the door and more ambitious goals, next year’s BRICS summit will no doubt be an even more extravagant affair. But whether Johannesburg will mark a rebirth as much as a facelift is still an open question.

Can the BRICS keep its brand if it enlarges too quickly and to dozens of members with different agendas and priorities? Can it widen and deepen at the same time? Will it evolve into a Chinese-dominated galaxy of satellites tied financially and globally to Beijing or will it become instead the egalitarian voice of the overlooked and disinherited that it has claimed to be in the past? Meanwhile, the West will need a coherent strategy to prevent the new BRICS from becoming yet one more giant rip in the fabric of a more divided world.

The views expressed in this #CriticalThinking article reflect those of the author(s) and not of Friends of Europe.