September 29, 2023

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The strategy behind BRICS expansion: Why six countries were chosen

The strategy behind BRICS expansion: Why six countries were chosen

The term BRIC was born in 2001 in a report by the international risk assessment firm Goldman Sachs to refer to four emerging economies with the world’s greatest growth potential: Brazil, Russia, India and China. At that moment, when Argentina was going through its worst economic and political moment (in democracy), it was impossible even to dream that the country would be called a full member after 22 years. It is going through another difficult economic crisis. And not the same case between The countries selected at the summit in Johannesburg on Wednesday.

It is clear that the group’s current five members are not choosing their six future partners based solely on their economic projections, any more than when they joined South Africa in 2010. At the time, many criticized it for not joining the ranks of countries with high GDPs – even today – such as Mexico, South Korea or Turkey. “I don’t understand South Africa being part of the BRICs. But South Africa being a representative of the African continent is a different story,” observed Jim O’Neill, head of international asset management at Goldman Sachs. Time in a British newspaper article Guardian.

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A different world

Today’s situation is very different from 2010This is true, and is one of the main reasons why the second expansion of the block was bigger than the first. By the time South Africa joined BRICS, the bloc accounted for about 18% of global GDP.. Today, some projections already surpass the total of the G7, a forum led by the United States and made up of France, Germany, Japan, the United Kingdom, Canada and Italy. Meanwhile, the Chinese-led group The G7 accounts for a third of world GDP, close to 30%.

Added to this A different international political situation 13 years ago. At that time, America’s global policing and democratic evangelicalism began to enter into crisis, but no one seriously disputed its global military, commercial, or financial dominance.. It is unimaginable that another power would mediate to resolve diplomatic conflicts in the Middle East, or that Washington would publicly threaten its closest European allies or Latin America, a region it has always considered an indisputable sphere of influence. Adoption of investments and technology from a competing power.

Today that scenario has become a reality. China was crowned this year as the mediator to restore diplomatic ties between the two powers, which have disputed politico-religious influence in the Middle East since the late 1970s, Saudi Arabia and Iran., coincidentally two of the six were invited to join the BRICS organization this Thursday. This wrestling has influenced many of the conflicts in the always-tense region and fueled by the United States (and Israel) for decades, and explains many of the paradoxes of its so-called war on terrorism, which has been fronted by Islam. Threat number one to Washington and the world.

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The Middle East, the center of interest

The first thing that attracts the attention of the examinee Of the six countries invited to join BRICS – a bloc that is over-represented in all parts of the Global South in the international community – that is Four are from the Middle East region and the fifth, say Ethiopia, is a neighboring country.

This is one of the data that mainstream Western media emphasized this Thursday BRICS included three of the world’s leading oil producers: Saudi Arabia, the United Arab Emirates and Iran. In this analysis, the choice of Argentina does not seem so strange because, along with the reserves at Vaca Muerta, the country has been at the center of attention of the global energy sector in recent years.

The BRICS have already shown their interest in the Middle East when they expanded their New Development Bank (NDB, its acronym in English), which today is directed by the former president of Brazil, Dilma Rousseff, and Argentina wants to enter the loan. For now, yesIt only accepted three members between 2021 and 2023, and two are from the region (now invited to become full members): the Emirates, Egypt and Bangladesh.. A fourth is in the process of being adopted and is South American: Uruguay.

One of the striking diversity of this Thursday’s selection by BRICS They chose two countries considered to be the wealthiest in the Middle East – Saudi Arabia and the Emirates – and two that are in the strongest economic crisis – Iran and Egypt.-. However, all four have international relevance that transcends economics.

For example, Bringing Saudi Arabia and Iran into the same political space Characterized by his strong rhetoric against authoritarianism and his constant demand for reforms in the political, commercial, and financial institutions America had built after World War II— Definitely marks a milestone. Likewise Egypt. The alliance with the United States was sealed 1978 Camp David Accords -in which he signed a peace deal and recognized the state of Israel and guaranteed a steady and massive flow of US financial and military aid – burying any illusions of pan-Arabism in the region and further enhancing the political map of the conflict fueled by Washington between the Saudis. Arabia and Iran.

Former US president and current favorite to win the opposition presidential nomination next year, Donald Trump, has intensified public support for the Saudi-Iranian rivalry., even bringing the Arab countries closer to Israel with the tacit approval of the Saudi monarchy. Given the prospect of a new Trump victory at the end of 2024, this Thursday’s BRICS decision opens the door for Republicans to find themselves in a different situation in this strategic region.

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to Professor Javier Waddell, Department of International Relations, Pontifical Catholic University of Minas GeraisBRICS elections in that region can be understood “Vector of Peace to Promote Development”.

Debt and the IMF, another common thread

Another thing to note is that Four of the six selected countries are in serious economic trouble. Argentina Suffocated by a shortage of dollars, hyperinflation is unrelenting and throbbing International Monetary Fund to shoulder the massive debt incurred by Mauricio Macri’s previous government; Egypt It is the Fund’s second-most important creditor—after Argentina—and is at odds with that credit institution in an environment of inflation; Iran Unable to recover from the crisis of inflation, devaluation, and a shrinking economy, it deepened the collapse of the nuclear deal when it unilaterally abandoned it and reimposed trade and financial sanctions on the Islamic Republic. trade; Finally, Ethiopia – the second most populous country in Africa, the headquarters of the African Union and, despite everything, one of the fastest growing economies on the continent – It is currently in talks with the Fund for $2,000 million to deal with its growing foreign debt.

In recent months, In the case of Argentina, China intervened and demonstrated that it is ready to provide loans of last resort to help countries that are suffocated by their foreign debts and unable to comply with the agreements signed with these credit institutions.America still has a singing voice as a major player in this.

The four guests with financial problems have another thing in common: In recent years they have significantly increased their trade relations with China and, importantly, with other members of the BRICS. Argentina, Iran and Ethiopia They already have China as their main trading partner Egypt Between 2021 and 2022 investments from bloc countries increased by more than 40% and trade by more than 10%.

Besides, Three of these countries have already started trading or have expressed a desire to do so without using the dollar. Argentina China already uses yuan swaps to import from that country, Iran It joined Russia’s call to trade the ruble to avoid sanctions imposed by Western powers over its invasion of Ukraine. Egyptian government Last June it announced plans to pay for Indian, Chinese and Russian imports with local currency. “Nothing has been implemented yet, but there are discussions for us to trade with the local currencies of these countries,” Minister of Supply Ali Moselhi explained to the company. Reuters.

New bricks

BRICS is not a military alliance like NATO or a formal bloc like the EU or a trade bloc like Mercosur. They were kind of born in 2009 The G7, on the other hand, is a simple forum to discuss the global agenda and generally reach decisions by consensusBut they show it They want to be a one-of-a-kind site -More flexible, without directors and with a more defined organizational structure- To promote a diverse international infrastructureParallel to the current one – for example with its Development Bank – and demanding reforms to the system created after World War II.

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There are still many doubts as to why some countries were selected and not others. In conversation with this portal, “They invited countries into the group that were not going to cause problems in the short term,” Waddell said.. Despite the fact that entry criteria were one of the main topics of discussion at the Johannesburg Summit, the final document did not mention any of them and It also does not establish requirements to be met by prospective membersThis happens in highly institutionalized blocks.

National legislatures are also not required to approve income Because it is not an international treaty, for example, some international organizations or organizations will have to enter as they explain. Discovery From the Argentine Ministry of Foreign Affairs. In other words, entry into full membership — if six countries accept it — would be immediate and simple on January 1, 2024. For this reason, many researchers have already begun to calculate and They predict that starting next year, BRICS will account for more than 45% of the world’s population and more than a third of global GDP.

India was one of the original members of the BRICS group that was most reluctant to a major expansion, according to the chronicle of recent years. On Thursday, after learning of the decision, the former Indian ambassador and member of the Gateway House think tank outlined the newspaper’s first explanation. Indian Express: “First, there is considerable anti-American sentiment in the world, and all these countries are looking for a group that can use that sentiment as a glue. Second, there is a lot of hunger for a diversity of countries in which a platform in the Global South can express their solidarity. A preview of this last function has already been seen War in Ukraine. None of the five original members joined the sanctions imposed by the US and its allies against Russia, nor condemned the Russian invasion with an affirmative vote in a UN General Assembly vote.