The global political landscape is undergoing a seismic shift with the expansion of BRICS (Brazil, Russia, India, China, and South Africa) to include new members such as Saudi Arabia, Iran, the United Arab Emirates, Argentina, Egypt, and Ethiopia.
This development marks a critical moment in the evolution of international relations, signaling a growing desire for a multipolar world order that counters the dominance of Western-led institutions like the G7.
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As these emerging economies and regional powers coalesce, the influence of BRICS on global trade, finance, geopolitics, and development is poised to reshape the dynamics of the 21st century.
This article explores the significance of the BRICS expansion, its implications for global governance, and the broader theme of Global South solidarity. Through data, statistics, and expert insights, we will delve into how this shift is likely to challenge the traditional Western-led order and empower emerging economies.
The Original Vision of BRICS
When BRICS was first conceived in 2009, it was envisioned as a coalition of rapidly growing economies that could serve as a counterweight to the dominant global financial and political institutions like the International Monetary Fund (IMF), the World Bank, and the G7. BRICS members represented a significant portion of global economic growth and were home to about 40% of the world’s population. With their collective GDP accounting for roughly 25% of global GDP at the time, the bloc sought to amplify the voices of the Global South in shaping global policy.
Over time, BRICS nations have focused on several key goals: promoting economic development, addressing infrastructure gaps in member countries, and reforming global financial institutions to better represent the interests of developing nations. The establishment of the New Development Bank (NDB) in 2014, with a focus on financing infrastructure projects in member states, demonstrated BRICS’ desire to create alternatives to Western-dominated financial structures.
BRICS Expansion: The New Members and Strategic Importance
The decision to expand BRICS by inviting new members—Saudi Arabia, Iran, the UAE, Argentina, Egypt, and Ethiopia—reflects a recognition of the shifting global power balance and the increasing geopolitical and economic importance of these nations.
Saudi Arabia and the UAE: These two Gulf nations are significant for their immense wealth derived from oil exports and their strategic geopolitical position in the Middle East. Saudi Arabia is the world’s largest oil exporter, and its inclusion in BRICS offers the bloc greater leverage in global energy markets. The UAE, with its advanced infrastructure and financial sectors, adds significant value to BRICS’ economic clout. Together, these nations enhance the bloc’s influence in the energy market, particularly in countering Western influence over oil pricing mechanisms.
Iran: Iran’s membership in BRICS is politically symbolic, signaling a broader alignment of the Global South against U.S. hegemony. Sanctioned by the U.S. for years, Iran has long sought alternative economic partners and platforms. Its inclusion strengthens BRICS’ anti-Western narrative, particularly in regions where U.S. sanctions have created economic hardship.
Argentina: As one of South America’s largest economies, Argentina’s inclusion in BRICS is a move toward enhancing the bloc’s influence in Latin America. Despite its economic challenges, Argentina’s natural resources—particularly its large reserves of lithium, crucial for the energy transition—make it a strategic addition.
Egypt: As Africa’s third-largest economy, Egypt brings geopolitical importance through its control of the Suez Canal, one of the world’s most critical shipping lanes. Egypt’s inclusion underscores BRICS’ focus on expanding its influence in Africa.
Ethiopia: Ethiopia’s growing economy and political leadership in the African Union make it a key player in Africa’s development. As one of Africa’s most populous countries and a leader in regional politics, Ethiopia’s membership in BRICS strengthens the bloc’s engagement with African nations.
A Shift Towards a Multipolar World
BRICS expansion reflects a clear desire for a multipolar world order, in which power is distributed across various global centers rather than concentrated in the hands of Western powers. This marks a departure from the post-Cold War era, where U.S. dominance and the Washington Consensus shaped global economic policies.
Multilateralism and Economic Rebalancing: The inclusion of oil-rich countries such as Saudi Arabia and the UAE into BRICS significantly boosts the bloc’s economic weight. Collectively, the expanded BRICS nations control about 30% of the world’s GDP and nearly 50% of global oil reserves. This newfound influence over energy markets gives BRICS the ability to challenge Western-dominated economic policies and financial institutions.
De-dollarization Efforts: One of the strategic goals of the expanded BRICS bloc is to reduce reliance on the U.S. dollar in global trade. The idea of creating a BRICS currency has been floated as a way to bypass the dollar in international transactions, particularly in light of U.S. sanctions that often cripple non-Western economies. In 2023, BRICS leaders emphasized their commitment to developing mechanisms for trade in local currencies, a move that could significantly erode the dollar’s dominance in global trade.
Global South Solidarity and the Rise of Alternative Institutions
The expansion of BRICS is also emblematic of a broader movement toward Global South solidarity, where developing nations seek to redefine global governance structures. The Global South has long felt marginalized by the Bretton Woods institutions (IMF and World Bank) and the G7, where the U.S., Europe, and their allies wield disproportionate influence.
The New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA), created by BRICS, are central to this strategy. The NDB aims to provide financing for infrastructure and sustainable development projects in BRICS and other developing nations, reducing dependence on Western lenders like the World Bank. As of 2023, the NDB had approved nearly $35 billion in loans across various sectors, ranging from renewable energy to transportation infrastructure.
Quoting economist Joseph Stiglitz, who has been critical of the dominance of Western financial institutions, “BRICS offers an opportunity for countries to develop financial mechanisms that are better suited to the needs of developing nations. The one-size-fits-all approach of the IMF and World Bank has not always worked for emerging economies.”
The expanded BRICS bloc, with new members from the Middle East, Latin America, and Africa, now has the potential to foster South-South cooperation on a scale previously unseen. This cooperation can be particularly impactful in addressing shared challenges such as poverty, infrastructure deficits, and climate change.
Economic Impact of BRICS Expansion
The economic potential of BRICS expansion is enormous. With the addition of new members, the bloc now accounts for over 45% of the world’s population and controls more than 30% of global GDP. The inclusion of Saudi Arabia and the UAE means that BRICS will also wield greater influence over the global energy market, particularly given that these nations are among the world’s largest oil exporters. In 2022, Saudi Arabia alone exported approximately 7.4 million barrels of crude oil per day, accounting for over 17% of global oil exports.
Additionally, BRICS members are major players in key sectors such as agriculture, technology, and manufacturing. China and India, for instance, are global leaders in technology and pharmaceuticals, while Brazil and Argentina are agricultural powerhouses, providing food supplies to much of the world. The synergy between these economies can lead to increased trade, investment, and innovation.
Trade in Local Currencies and De-Dollarization
One of the most significant outcomes of BRICS expansion is the potential for enhanced trade in local currencies. The bloc has expressed its desire to reduce reliance on the U.S. dollar, particularly in light of economic sanctions imposed on Russia and Iran, which have forced these countries to explore alternatives. The idea of creating a BRICS currency is being actively discussed, although challenges remain in aligning the diverse economic policies of member countries.
According to Zhu Min, a former deputy governor of the People’s Bank of China, “Reducing dependence on the dollar for international trade will require significant financial integration within BRICS. However, with the economic weight of the new members, we are starting to see a credible alternative to dollar dominance in global trade.”
Intra-BRICS trade, conducted in local currencies, would help insulate member countries from the impact of global financial shocks tied to the dollar, such as interest rate hikes by the U.S. Federal Reserve, which often have ripple effects on emerging economies.
Political and Geopolitical Implications
BRICS’ expansion also carries significant geopolitical implications. By including nations like Saudi Arabia and Iran, BRICS is inserting itself into the geopolitically sensitive Middle East, a region that has traditionally been within the sphere of U.S. and European influence. Saudi Arabia’s strategic alliance with the U.S. makes its decision to join BRICS particularly noteworthy, as it suggests a diversification of the kingdom’s global partnerships.
The participation of Iran, a country under heavy U.S. sanctions, further underscores the bloc’s desire to challenge Western hegemony. Iran’s inclusion provides BRICS with a direct link to the Middle East, enabling greater engagement with the region’s political and economic affairs.
Moreover, by expanding into Latin America (Argentina) and Africa (Egypt and Ethiopia), BRICS is deepening its ties with regions that have long been on the periphery of global governance. These regions, home to rapidly growing economies and large populations, are likely to benefit from the investment and development opportunities presented by BRICS.
Challenges Ahead
Despite its growing influence, BRICS faces several challenges. The economic and political diversity of its members makes consensus-building difficult. Countries like China and India, for example, have competing geopolitical interests, particularly regarding border disputes. Additionally, the economic disparity between members—such as between South Africa and China—could hinder the group’s cohesion.
Moreover, the creation of a BRICS currency, while appealing in theory, faces logistical and technical challenges. The bloc’s members have vastly different monetary policies and levels of economic development, making financial integration a complex process.
The expansion of BRICS marks a new chapter in global geopolitics and economics, one where the Global South is asserting itself on the world stage. As BRICS grows in size and influence, it will likely play an increasingly important role in shaping the future of international relations, particularly by offering an alternative to Western-led institutions
In a world where economic and political power is becoming more distributed, the BRICS expansion reflects the desire of emerging economies to carve out their space in a multipolar world. While challenges remain, the growing solidarity among the Global South suggests that the era of U.S. and Western dominance may be slowly giving way to a more balanced, multipolar global order. The potential of BRICS to offer meaningful alternatives to Western-led financial, trade, and political institutions is immense, and its expanded membership signals that this bloc will continue to shape global governance in the years to come.