The BRICS group of emerging nations - Brazil, Russia, India, China and South Africa - will meet for their annual summit starting on August 22 in Johannesburg.
This year's summit has gained importance at a time when China and Russia are trying to increase their political influence and tensions between the US and its allies are high.
How did BRICS come about?
It began as the BRIC acronym, coined in 2001 by economist Jim O'Neill at the US investment bank Goldman Sachs to group together the four largest and fastest growing economies at the time. O'Neill highlighted how the four economies - Brazil, Russia, India and China - could together become a global economic force in the coming decade.
Investors have taken the lead and so have politicians in these countries. Putting aside their political and social differences, developing countries felt bound by a shared urge to restructure the US-led global political economic and financial systems to make them "fair, balanced and representative".
BRIC leaders held their first annual meeting in 2009 in Yekaterinburg, Russia. A year later they invited South Africa to join the political club and an "S" was added to the BRIC acronym.
Why do you care?
BRICS members represent more than 42% of the world's population and account for nearly a quarter of global gross domestic product (GDP) and 18% of trade.
The grouping is hailed by some as a counterweight to Western economic and political forums and institutions such as the G7 and the World Bank. He believes the bloc could use its political clout and economic clout to push for much-needed reforms at the World Bank and International Monetary Fund to represent the reality of a multipolar world.
What have BRICS achieved so far?
BRICS has sought to live up to its potential to offer an alternative to traditional financial and political systems.
Among its notable achievements is the establishment of the New Development Bank, or BRICS bank, a multilateral development bank with subscribed capital of USD 50 billion (€45.6 billion) to finance infrastructure and climate-related projects in developing countries. The bank, whose shareholders include BRICS members as well as Bangladesh, Egypt and the United Arab Emirates, has so far approved more than $30 billion in loans since it was founded in 2015. By comparison, the World Bank committed more than $100 billion in 2015 to 2022 alone.
BRICS has also created a US$100 billion Contingency Reserve Arrangement, a foreign currency liquidity facility that members can use during global financial turbulence.
The bloc is said to be pushing for the creation of a common currency in an attempt to challenge the dominance of the dollar. The BRICS currency is not expected to materialize anytime soon. As a result, the bloc is currently focusing on deepening the use of local currencies in trade between members.
"Apart from the creation of the BRICS Bank... it is hard to see what the group has done beyond annual meetings," Jim O'Neill said in a 2021 article.
The grouping's limited success can be explained by the often diverging and competing interests of its members, particularly those from China and India, which share a disputed border and have seen ties deteriorate in recent years.
How has trade and investment fared among BRICS members?
The BRICS have seen their economic influence grow over the past two decades, largely due to years of rapid growth in China, the world's second-largest economy by GDP, and India's rise to become the fifth-largest economy. currently the fastest growing major economy.
The economies of Russia and Brazil have not been able to sustain their momentum and have fallen back to where they were in 2001 in terms of their share of global GDP. South Africa's economy has also struggled with gearing since joining the BRICS.
While BRICS is now a major force in international trade, trade among its members has remained relatively low because there is no bloc-wide free trade agreement.
In terms of investment, the bloc has seen annual foreign direct investment (FDI) inflows more than quadruple from 2001 to 2021. However, intra-BRICS investment remains subdued, accounting for less than 5% of their combined FDI inflows in 2020.
Why are other countries interested in joining BRICS?
BRICS expansion is among the key topics at the annual summit in South Africa. Twenty-three countries have applied for full-time BRICS membership, including Iran, the United Arab Emirates, Argentina, Indonesia, Egypt and Ethiopia.
China has pushed for BRICS expansion to increase its political influence amid growing rivalry with the US. For Russia, it is about finding new allies at a time when it is subject to Western sanctions over the war in Ukraine. Brazil and India have long opposed the bloc's rapid expansion, with New Delhi concerned about growing Chinese influence at the club.
As BRICS strives to fulfill its economic potential, it projects itself as a geopolitical alternative to the US-led world order and positions itself as a representative of the global South. The new members are eager to take advantage of BRICS influence and economic influence.
The BRICS alliance, comprising Brazil, Russia, India, China and South Africa, has become a powerful economic and geopolitical bloc in recent years. Given its substantial influence on global affairs, it is no surprise that other countries, including Saudi Arabia, are interested in securing membership. In this article, we will delve into an SEO-optimized survey of why Saudi Arabia, along with other countries, are actively competing for a coveted spot in the BRICS.
Economic opportunities and growth prospects:
The BRICS countries together account for a significant portion of the world's GDP. As a major global oil exporter, Saudi Arabia sees membership as a gateway to diversifying its economy away from oil dependence. Access to BRICS markets offers the potential for increased trade and investment, thereby accelerating economic growth and stability for aspiring member countries.
Strategic partnerships:
BRICS membership promises enhanced diplomatic and strategic cooperation. Saudi Arabia seeks to strengthen its ties with influential members such as China and Russia and use their political influence for its regional and global interests. Such partnerships offer the potential to address pressing issues such as security issues and regional stability.
Geopolitical Balance:
BRICS serves as a counterweight to the influence of Western powers. Joining the alliance provides a platform for Saudi Arabia and other aspiring countries to express their views on international affairs, promote a multipolar world order and reduce dependence on traditional power centers.
Infrastructure and development initiatives:
One of the cornerstones of BRICS is its commitment to infrastructure development and sustainable growth. With its ambitious Vision 2030 plan, Saudi Arabia aligns its development goals with the alliance's agenda. By joining BRICS, a nation will gain access to expertise, resources and funding for its infrastructure and socio-economic projects.
Energy cooperation and resource sharing:
Saudi Arabia's energy resources and expertise align with the energy-focused BRICS discussions. The alliance's emphasis on energy security, sustainability and technological cooperation offers opportunities for the Kingdom to share its knowledge while benefiting from the collective knowledge of other members.
Market access and investment opportunities:
The BRICS countries represent a massive consumer market. Membership offers Saudi Arabia access to a large consumer base, thereby promoting trade diversification and economic growth. In addition, alliance investment initiatives open doors for cross-border investment and joint ventures and attract foreign capital and expertise.
Cultural and civilizational exchanges:
Becoming part of BRICS facilitates cultural exchanges and people-to-people contacts. This provides Saudi Arabia and other aspiring members with a platform to showcase their rich heritage and traditions and promotes better understanding and cooperation between different cultures.
The race by Saudi Arabia and other countries for BRICS membership signifies the growing importance of the alliance on the global stage. In addition to economic opportunities, these efforts are driven by a complex interplay of strategic, geopolitical and development factors. As Saudi Arabia aspires to join the BRICS ranks, it seeks to carve out a meaningful role in shaping the alliance's future and contribute to a more balanced and multipolar world order.
As the global economic landscape continues to evolve, regional alliances play a key role in shaping global dynamics. The BRICS group, which consists of Brazil, Russia, India, China and South Africa, has gained significant attention since its inception. Now, other emerging economies such as Saudi Arabia are seeking membership. This article examines the motivation behind Saudi Arabia's interest in joining the BRICS and examines the potential benefits and implications of this expansion.
Why Saudi Arabia and others are seeking BRICS membership:
Economic benefits:
Saudi Arabia, with its significant oil reserves and strategic location, is seeking to diversify its economy beyond its dependence on oil. Joining the BRICS could offer access to a dynamic economic partnership that would promote trade, investment and technological exchanges. Cooperation with strong economies such as China and India can help Saudi Arabia achieve sustainable economic growth.
Geopolitical influence:
BRICS members collectively have significant geopolitical influence. Saudi Arabia's interest in joining BRICS reflects its aim to strengthen diplomatic ties and strengthen its voice on global issues. By aligning with influential members, Saudi Arabia can better address its regional and global challenges.
Investment opportunities:
The BRICS platform provides a channel to attract foreign investment. Membership would open the door for Saudi Arabia to showcase its investment potential and attract capital inflows. Projects based on cooperation in different sectors could stimulate economic development and job creation.
Technology and Innovation:
As a BRICS member, Saudi Arabia would gain access to technological advancements and innovation-based economies. This collaboration could accelerate the kingdom's efforts to transition to a knowledge-based economy that promotes innovation and modernization.
Benefits and Consequences of BRICS Expansion:
Improved business flows:
BRICS membership could lead to increased trade ties between Saudi Arabia and existing BRICS members. This expansion can lead to the reduction of trade barriers and the creation of new market opportunities that will benefit all parties involved.
Geopolitical Balancing:
Expanding BRICS to include countries from the Middle East, such as Saudi Arabia, could contribute to a more balanced distribution of power around the world. This could potentially offset the influence of other regional alliances and reshape geopolitical dynamics.
Economic resilience:
A broader BRICS alliance would create a larger economic bloc capable of withstanding global economic shocks. Saudi Arabia's participation could strengthen the group's collective resilience and stability.
Cultural exchange:
BRICS membership includes not only economic and political cooperation, but also cultural exchange. The inclusion of Saudi Arabia could promote cross-cultural understanding and strengthen people-to-people relations between different member states.
The prospect of Saudi Arabia and other countries seeking BRICS membership underscores the importance of this alliance in today's rapidly changing world. As Saudi Arabia seeks to exploit economic, geopolitical and technological advantages, BRICS expansion has implications for global politics, economics and cultural exchange. As the dynamic continues to evolve, the potential addition of new members will undoubtedly shape the future trajectory of the BRICS alliance and the world stage in general.
0 Comments