The year is 2024, a milestone in global economic history, as the BRICS bloc—Brazil, Russia, India, China, and South Africa—embarks on a major expansion. But this is not a simple opening of its doors; this is a bold statement upon the changing world order, inviting Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates to the BRICS table. And this is not just a statement: it is a challenge. It is a challenge to the West’s monopoly on politics and economics, signaling a future world in which power is more equitably distributed. This marks the premise of a comprehensive dialogue on the consequences of this expansion, including the potential reconfiguration of economic blocs and, indeed, the geopolitics of the world.
BRICS: An Economic Powerhouse in the Making
These 10 economies, representing over 50% of global GDP and some 42% of the world’s population, account for a significant share of global economic production. With combined GDP now exceeding $28.5 trillion on a PPP basis, the new G10, or BRICS+, represents a serious arrival on the global economic scene, and one that will have significant global economic, and even political, ramifications. Because this isn’t just an increase in numbers, it’s an erosion of global economic power from the Western countries of the Global North to the Global South’s emerging markets. Including these new economies serves to strengthen its economic clout, coalescing a diverse array of markets, each with its unique strengths, and opportunities. The increased GDP contribution from the new members boosts the bloc’s negotiating power, and could in the process, help effect a shift in global trade dynamics, which has historically been in favor of the G7 economies.
Economic forecasts for the new BRICS members are extremely promising: Egypt is expected to witness a near 635% increase in its Gross Domestic Product (GDP) by 2050, Ethiopia, an even more impressive 1,170 percent. These projections point to the socioeconomic ascendancy of the Global South and the disruption of the traditional global economic pecking order. This socioeconomic wave that portends a move away from the dominance of Western economies, promises to deliver new investment opportunities. It also serves to undermine the traditional economic order. However, the ambition of BRICS goes beyond mere economic ledger statistics. Rather, BRICS aims to establish the infrastructure for a new global methodology, one that is built on a relatively fair and egalitarian international order. The creation of the New Development Bank is a sign of BRICS’ newfound freedom, a bank that is designed to serve as a counterpoise to the World Bank. A bank of a different color, which would be more representative, and impartial, reflecting the bloc’s growing importance on the world.
source Goldman Sachs
The Currency Conundrum
A common BRICS currency would potentially reduce the influence of the highly volatile and erratic US dollar and would result in easier trade within the bloc and stabilization of the currencies of the regional economies (most of which are currently affected by rampant inflation). This issue has been under discussion for long, but the path is tricky and slow, as the current macroeconomic diversity among BRICS countries is considerable. There is also a political diversity between all these countries, and the US dollar’s stranglehold on global finance has been meticulously cultivated over the past many decades.
The Harmony and Discord Within
The Sino-Indian Dichotomy
The bilateral economic competition and geopolitical competition between China and India is an open secret within BRICS — they’re not just competitors economically within their retail and industrial sectors, but also at the geopolitical level. The juxtaposition of products of “Made in China,” competing against similar ‘Make in India’ offerings across the globe–under the aegis of each independent country–is a visible sign of things to come.
The Chinese Conundrum
China is embroiled in a domestic economic slowdown, with an aging populace and a prospective real estate problem at home (which is potentially decimating to the already depleted boom-bust cycle) affecting the broader BRICS grouping. Trade wars, especially against the US, may complicate Chinese domestic politics, further affecting their collective heft.
BRICS is an expansive block that brings together rich cultural and political diversity — from China’s collectivism to India and Brazil’s vibrant democracies and the Islamic traditions of its Middle Eastern members. The key to its longevity and success would be the ability to manage and balance these differences in the pursuit of a shared vision. The expansion also marks the gradual shift of the world stage from west to east. With its growing economic and strategic clout, BRICS will pose a challenge to the established global order and leverage its influence in oil and energy markets. Its stance on a multipolar world order instead of western hegemony and alternative approaches to conflict resolution and peacekeeping could mold international relations in a new shape.
The story of BRICS is not one of being an emerging counterpoise to an old order but about aspiring to create a new order in an imperfect world. It is a story of how emerging powers — facing substantial immediate obstacles, with no guarantees of unity or future success, and yet feeling the responsibility of reshaping global governance — are redefining international politics. A long-term and systemic shift in global dynamics is underway, and BRICS embodies the splitting of the Old Continent. Its success will not be measured in terms of economic might alone; it will be determined by the unity it can maintain and the voice it provides to the Global South in rewriting today’s continuity of imbalance narrative to one of balanced partnership and cooperation.