The coming together of the BRICS

FreedomLab
August 7, 2018

The coming together of the BRICS

FreedomLab
August 7, 2018

The coming together of the BRICS

FreedomLab
August 7, 2018
The coming together of the BRICS
FreedomLab
Maya Turolla
August 7, 2018
© Flickr

What happened?

This week, the 10th annual BRICS summit took place in South Africa. Apart from Brazil, Russia, India, China and South Africa, the heads of state of a range of African countries as well as Turkey also attended. China pledged funding for the South African electricity company Eskom and announced other deals worth $14.7 bn. On his way to South Africa, Indian PM Modi pledged $205 million funding for Uganda and the opening of 18 embassies in Africa. Besides the theme “BRICS in Africa”, the main topic of the summit was U.S. policy and trade protectionism.

What does this mean?

The acronym was coined by Goldman Sachs economist Jim O’Neill in 2001 and since 2009, BRICS’ heads of state have annual meetings. Since the term was coined, the GDP of the bloc has increased six-fold and its economic size is now similar to that of the U.S. or the EU. Moreover, the bloc’s member countries account for 41% of the world’s population. Nevertheless, the forum has mostly been a talking shop. These countries do not constitute a unitary bloc because they are too diverse (in terms of geography and economic structure) and have too many internal issues (economic and geopolitical rivalry). But that might change.

What's next?

Current developments could finally bring these diverse countries closer together. Economic and political disputes have brought sanctions to both China and Russia, which also affect South Africa. Brazil and South Africa need to kick-start their economies and India, meanwhile, is trying to increase its international clout. Although their internal differences will remain, all of these countries are regional powers with their own spheres of influence and trade blocs (such as the BRI, EEU and Mercosur). At a time when the global hegemon (the U.S.) is becoming more unpredictable, they have common cause to push back. The BRICS could evolve into a forum that aligns different regional blocs.

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