In June 2009, the heads of these countries held their first meeting in Russia and raised the cooperation of the BRIC countries to the summit level before a fifth country, South Africa, joined this bloc, thus changing the name of the bloc to BRICS.
Economic power
Forming countries BRICS group The five combined account for about 40 percent of the world’s area and about 42 percent of the world’s population of about 3.2 billion people, while their gross domestic product amounts to about 26 percent of the world’s population. Global GDP It controls about 18 percent of global trade.
The bloc contains a group of global economic giants such as China Which ranks second on the list of the world’s largest economies, along with… India It is achieving significant growth rates and is on its way to becoming the third largest economy in the world, as the International Monetary Fund expects the size of the Indian economy to exceed about $6 trillion by 2028.
As it is considered Russia One of the strengths of this bloc is due to the strength of its economy and huge reserves of… Oil andmystification.
In addition to these countries, the economy emerges Brazil Also as an economic force forming the BRICS group, with a domestic product of up to 2.2 trillion dollars and a record surplus in the trade balance of nearly 100 billion dollars at the end of last year. The group also includes South Africa’s diversified economy, which has proven its ability to withstand global economic crises, with a gross domestic product of $381 billion.
The five countries, with their economic capabilities, represent a bloc no less important than the global economic blocs, but after the Russian-Ukrainian war, there was much talk about the formation of a new world order and the extent of the countries’ need for a more balanced economic system, and global interest in the BRICS alliance increased.
But before that, specifically in 2017, the member states of the BRICS group discussed what was called “BRICS Plus,” a plan through which the group seeks to add new countries to the bloc.
Brix Plus.. More power
In August last year, the BRICS group announced the joining of four new countries: the UAE, Egypt, Iran, and Ethiopia. Once these countries joined, they added approximately one and a half trillion dollars in GDP to the group’s economy.
During the BRICS Business Forum, Russian President Vladimir Putin said that the G7 accounted for 45.5% of the global gross domestic product in 1992, compared to 16.7% for the BRICS countries. He pointed out that the BRICS share of the global economy reached 37.4% in 2023, compared to the share of the BRICS group. seven, amounting to 29.3%, stressing that the gap “is widening and will inevitably widen.”
New bank and currency
During the Fortaleza Summit held in Brazil in 2014, the BRICS countries decided to establish a development bank called the New Development Bank (NDB), in addition to establishing the Monetary Reserve Fund (CRA), which aims to provide protection Against global liquidity pressures This includes currency issues where member states’ national currencies are negatively affected by global financial pressures.
The Development Bank plays a key role in granting billions of dollars in loans to finance infrastructure projects, health, education, etc., in member countries of the group, as well as other emerging countries.
It seems that the idea of establishing international institutions parallel to the Bretton Woods institutions, such as the International Monetary Fund and the World Bank, to support growth and development at the international level, without political and social restrictions or requirements, constitutes the first step in the group’s plan to create a new global order.
Strategically, the countries of the group seek to reduce the dominance of the dollar on intra-trade between them by adopting a unified currency that brings together the countries of the group or by adopting the national currencies of these countries.
When will the BRICS coin be issued? There is no specific launch date yet, but the leaders of the group’s countries have already discussed the possibility during the 14th BRICS summit, held in mid-2022, and Russian President Vladimir Putin has also confirmed that the BRICS countries are planning to issue a “new global reserve currency,” and are ready to operate in a more… Open with all fair trade partners.
The economies of the BRICS countries have become complementary to each other, as they control huge reserves of gas, oil, and minerals, in addition to technology, human competencies, and agricultural wealth. The group now owns a development bank and an attractive monetary reserve fund for developing countries that need aid and loans. But this economic giant faces major challenges that will hinder its growth.
Challenges faced by BRICS
The BRICS group may have been able, in a short time, to achieve a set of goals, but the path is not without challenges. Despite the available strengths, the BRICS group is not yet considered an effective global bloc in international crises.
Also, the countries of the group do not adopt unified positions on the issue of abandoning countries or confrontation with the West and the United States, as is the case with Iran, Russia, and to a lesser extent China.
The economic competition between China and India also emerges as an important challenge for the group, as New Delhi seeks to benefit from the trade war between Beijing and Washington and presents itself as the West’s new alternative to China.
In addition, the large difference in the economic strength of the group’s countries emerges as a source of concern regarding its impact on the size of internal influence, as Ethiopia stands out as the poorest country in the group in the face of China as the second largest economy in the world.