Is the BRICS expansion a challenge to US hegemony?

The unveiling of BRICS 11 in South Africa has prompted global analysis, focusing on the potential game-changing implications of this development.

BRICS 11 expands on the original BRICS alliance, comprising Brazil, Russia, India, China, and South Africa. The strategic bond between Russia and China aims to unite BRICS members against U.S. “diplomacy”, forming a united front to counter external pressures. By pursuing alternative financial mechanisms and advocating alternatives to SWIFT, BRICS nations strive to safeguard their economies from sanctions. BRICS 11 underscores the importance of sovereignty and self-reliance, challenging “Western” dominance. Those interested in preserving national sovereignty should study the developments in BRICS carefully. The potential integration of BRICS 11 with the Shanghai Cooperation Organization (SCO) establishes a counterbalance to US imperial military threats, aligned with President Lukashenko’s vision of a “Global Globe.”

Originating as an investment bank concept, BRICS has transformed into a significant global entity. Comprising Brazil, Russia, India, China, and South Africa, the group wields influence as a multilateral lender. Now, it expands its influence by welcoming Saudi Arabia, Iran, Egypt, the UAE, Argentina, and Ethiopia in 2024. This expansion aligns energy giants with major consumers, bolstering economic prowess. Renamed BRICS+, the coalition gains potential to challenge the dominance of the dollar in energy trade, indicating a shift in global dynamics.

The BRICS group, which initially emerged from an investment bank’s idea, has evolved into a formidable international alliance. It includes Brazil, Russia, India, China, and South Africa and operates as a multilateral lender. The group is expanding its membership to include Saudi Arabia, Iran, Egypt, the United Arab Emirates, Argentina, and Ethiopia in 2024. This enlargement brings together major energy producers with significant consumers, potentially enhancing the group’s economic influence. The expanded alliance, now referred to as BRICS+, could also challenge the dominance of the U.S. dollar in energy trading by exploring other currencies.

BRICS originated in 2001 with the term “BRIC,” coined by economist Jim O’Neill to highlight the growth potential of Brazil, Russia, India, and China. These countries capitalized on their shared interests and challenges, leading to the first BRIC foreign ministers’ meeting in 2006 and the inaugural leaders’ summit in 2009. South Africa joined in 2010, expanding the acronym. The recent expansion, set for 2024, was agreed upon during a summit in Johannesburg.

Financial achievements of the BRICS include a $100 billion foreign currency pool for emergency lending among member countries, operational since 2016, and the establishment of the New Development Bank, which has provided loans for infrastructure projects. While there is interest in increasing trade in local currencies, no concrete steps have been announced. The idea of adopting a common currency hasn’t gained traction.

Trade between the existing BRICS members saw a 56% increase to $422 billion from 2017 to 2022. While Brazil and Russia’s resources align well with Chinese demand, political rivalries and disputes have hindered trade between India and China. Differences in political interests, security concerns, and governing systems have made it challenging for the BRICS members to agree on global issues.

In terms of influence within BRICS, China has the largest GDP, but India serves as a counterweight due to its population size. While BRICS hasn’t formally endorsed China’s Belt and Road Initiative, the New Development Bank has equal holdings from China and India, indicating a balance. Russia’s membership continues despite its actions in Ukraine, with the other members considering the conflict a regional matter. However, Russia’s relationship with BRICS institutions has been affected.

BRICS aims to promote a multipolar world, challenging the U.S.-dominated global order. Similar groups gaining influence include OPEC, the Shanghai Cooperation Organization, and others. The expansion of BRICS could lead to a different global economy, and its influence might differ from the Capitalist market-oriented groups like the G-7.

BRICS 11’s expansion was led by China and supported by Russia and South Africa. India was cautious about China’s dominance, and Brazil was concerned about alienating Western countries. The impact of this expansion on global affairs and the economy remains to be seen. However, the shift from the original BRICS concept is evident.