Amid escalating discussions about de-dollarization, the BRICS bloc is experiencing a significant rise in interest from potential new members, with 34 countries expressing a desire to join, according to Russian President Vladimir Putin. This development reflects growing global engagement with the BRICS group, which was initially founded in 2009 by Brazil, Russia, India, China, and South Africa.
Expansion and Integration Efforts
Putin highlighted the increasing interest in BRICS during a recent meeting with representatives responsible for the bloc’s security. He emphasized Russia’s commitment to facilitating the integration of new member states into BRICS structures, with a focus on discussions about the modalities of this expansion set to be addressed at the upcoming BRICS summit in Kazan from October 22-24.
The BRICS+ group, which now includes Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE, represents 45% of the global population, 25% of global trade, and 31.5% of global GDP. Recent reports suggest that countries like Malaysia and Thailand are also keen on joining, which could enhance cooperation between BRICS+ and ASEAN, potentially leading to the establishment of a broader cooperative framework.
Prospects for BRICS-ASEAN Cooperation
Yaroslav Lissovolik, founder of BRICS+ Analytics, proposed that the BRICS-ASEAN cooperation could evolve through frameworks like BEAMS (BIMSTEC, Eurasian Economic Union, ASEAN-China FTA, MERCOSUR, and Southern African Customs Union). This network could significantly boost trade and investment along the South-South axis.
Lissovolik also pointed out the potential for greater participation of ASEAN countries in the BRICS New Development Bank (NDB). Recent NDB expansions have included members from Africa, the Middle East, South America, and South Asia. There is potential for further expansion into East Asia with ASEAN members such as Indonesia, Thailand, Cambodia, and Malaysia.
De-Dollarization and New Payment Systems
As BRICS moves towards de-dollarization, discussions are intensifying around establishing a new financial payment mechanism. This system, potentially similar to SWIFT but operating through the BRICS Bridge platform, aims to facilitate trade in national currencies of BRICS countries. The New Development Bank is expected to support this transition by acting as a platform for integration, conversion, and clearing.
Kester Kenn Klomegah, an independent researcher, notes that the BRICS Bridge is in advanced stages of development and could disrupt the dominance of the U.S. dollar in global markets. The primary goal is to reduce dependence on the dollar and promote trade settlements in local currencies, particularly benefiting developing countries in the Global South.
Geopolitical Implications
The expansion of BRICS and the potential introduction of a new payment system signify a strategic shift towards a more balanced global economic order. The BRICS bloc, with its growing economic clout and increasing membership, challenges the traditional G7 dominance. According to Equip Editorial, BRICS countries are leading a geopolitical shift towards a more equitable global economic balance.
As major BRICS economies, such as India, continue to grow rapidly, the gap with the G7’s share of global GDP is expected to narrow. The bloc’s focus on increasing oil production, with new members like Saudi Arabia and the UAE, further enhances its global economic influence.
In summary, the BRICS bloc’s expanding membership and efforts towards de-dollarization highlight a significant shift in global economic dynamics, with emerging countries playing an increasingly prominent role in shaping the future of international finance and trade.
