The atmosphere of the global economy is no different now from what it was in August 2023 when the BRICS summit was held in South Africa, but what is new in the 2024 Russia summit scheduled to be organized from October 22 to 24 of this year is the United States’ adoption of an interest rate cut and expectations of continued monetary easing. Besides retreat Oil prices in recent months, although they rose slightly during the past two weeks due to Israel’s war on… Gaza Lebanon and the possible repercussions of a strike Iran.
There is an important thing in reading the performance of the BRICS group, which is that the Russian media is currently leading the media aspects of BRICS, but the reality is that some BRICS countries, such as India It has no problems on the political and economic levels with America, either Brazil Which was noted from the statements of its president Lula da Silva During the 2023 BRICS summit in South Africa, it was trying to tone down the tone adopted by Russia, as he stated that “the goal of BRICS is not to challenge other international alliances such as the G7 or the G20, nor to challenge the United States,” but rather seeks only to organize the so-called “global south.”
It is noted that the language of the Brazilian President’s speech is completely different from what is adopted by Russian officials, as well as the media that expresses Russia, even though the Brazilian President adopts the same demands for the necessity of a unified BRICS currency and more equitable global economic conditions for emerging and developing countries, and his focus at the end of the South African summit after the accession of 5 new members confirm that the BRICS summit, after expanding membership, will have a better status than before.
Waiting for the outcome of the upcoming BRICS Russia summit, amid challenges that still remain in front of it, which are as follows:
The challenge of having uniform agreements
The BRICS group includes a mixture of economies at different levels. China is far ahead of all the economies of the member states and constitutes the top of these countries’ performance, in addition to the presence of members of emerging countries such as India, Brazil, and Russia.
On the other hand, there are other countries whose economies are modest compared to China or developed countries, such as Egypt, Ethiopia, and Iran. The group of oil-producing countries also includes Saudi Arabia and the Emirates, and their sources of economic power are limited only to oil resources.
World Bank database figures indicate that the GDP of China (the largest economy in BRICS) is $17.7 trillion, while Ethiopia – the poorest country in the bloc – has a GDP of only $163 billion.
Since the establishment of the BRICS grouping or the expansion of its membership in 2023, there has been no agreement on agreements regulating intra-trade for members of the grouping, or the existence of programs that work to strengthen the economic conditions of its members. Most of what has happened, if not all of it, is the result of inter-relations between each two countries with each other, without the presence of Collective mechanism for BRICS members.
Nor has it begun to form institutions that can be considered within a (confederal) coordination framework at the sectoral or policy level of the BRICS countries, whether with regard to economic, development, or sectoral policies. What was found regarding the Infrastructure Bank was originally a Chinese project par excellence, even if China employed members. BRICS gathered well in its launch.
As if it stems from a collective desire of the BRICS members, while the reality is otherwise through the capital shares – which China controls at a rate of 26% – the rest of the member states (about 56 countries) own the rest of the capital shares.
Single currency
Some have long dreamed of issuing a unified currency for BRICS since the South African summit was held in 2023, and some hoped that the 2024 Russia summit would adopt the unified currency, so that the BRICS group would begin its first steps to remove the dollar from the throne of financial and economic settlements or its position would decline.
It is noteworthy that the unified currency was promoted months ago by Russian media that it would be presented for study at the 2024 Russia Summit, but the matter took a different direction with the Russian sources themselves denying that the matter was included in the summit’s agenda.
Emotional writings view the BRICS issue without regard to scientific standards. The single currency issue is preceded by economic arrangements at the levels of trade, investment, employment, monetary, and financial policies. Then the single currency comes after the completion of these steps, which may require several years, not less than 10 years. With regard to BRICS members, if the political will and readiness of programs and tools are available.
Unreal comparisons
Some people like to present comparisons between the performance of the BRICS countries and other organizations such as the G7 industrial group or the European Union, but in reality these are comparisons that are not built on correct foundations. In the case of BRICS, the matter is nothing more than compiling statistics, and announcing that the gross domestic product of the BRICS countries reached such and such value, or It represents such a proportion of global domestic product, or outperforms the GDP of a group, or that BRICS exports or foreign trade outperform a grouping.
But the reality in the G7 industrial group and the European Union is different, as they are based on unity of policies, as is the case in the Union, or at least a high degree of coordination, as is the case in the group.
The biggest dilemma facing the BRICS group is that it does not yet have programs for the collective advancement of members or to improve economic conditions.
Not a challenge
Everything has a price, although matters regarding money and economics should be taken within the framework of study and the ability to bear risks.
Although steps have been taken at the level of the Infrastructure Bank or settling a small amount of intra-trade through local currencies, all of this does not amount to BRICS demands for an alternative to the financial settlements system (SWIFT) controlled by America.
Moreover, talk about searching for an alternative to the dollar to settle commercial and financial transactions at the global level has not been acted upon for years, and therefore America and the West have a feeling that the BRICS grouping does not represent a major threat in light of its cooperative economic performance, in addition to the absence of any image of economic integration.
In a historical reading, the majority of institutions and bodies that have been established since the 1950s to confront Western and American economic monopoly and colonialism were limited only to demands, without entering into practical steps that would enable them to achieve institutions corresponding to Western and American institutions, so that there would be parity in competition and activation of the demands for change.
In conclusion, the BRICS grouping may be viewed in light of the unity of the challenges it faces, while there is no view of unity of destiny and the ability to confront, if necessary, with the West and America. It is noted that China is managing its conflict with America and the West in light of what is called “strategic patience.” It does not begin with a decision or confrontation, but rather follows a policy of reciprocity, in order to preserve its economic interests, and to complement its strategy in positioning itself on the maps of international political, economic, and military powers.
There are other countries that have problems that require an alliance, but the level of interconnection between BRICS members has not yet reached the level of a single representation. Both Iran and Russia have political and military problems that may be resolved for several years if the political will is available. However, there is no state of cohesion. Among the BRICS members to adopt the position of Iran and Russia in confronting the West and America.
The reason for monitoring and waiting for the performance of BRICS in the coming period may be that time is considered in the establishment and development of such groupings or blocs, and perhaps the coming days will reveal to us tools and cards of power within which the BRICS group can move or be possessed.
