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BRICS South Africa declaration: Making of world’s economic behemoth

In an unequivocal tone last week, BRICS, the new group across the global south, sent signals showing that it has arrived firmly on the global…

In an unequivocal tone last week, BRICS, the new group across the global south, sent signals showing that it has arrived firmly on the global stage. The group of five extended membership invitations to six nations across the various regions of the world to boost its foothold, and outlined its plans to engage with the rest of the international community.

It is set to play dominant roles in the global business, trading, banking, and payment systems. It is ready to play roles in education, technology, agriculture, women and youth empowerment, and other areas where value addition is crying for attention. BRICS has made it clear that, while ready to collaborate with other international agencies, it is ready to stamp its feet firmly on these systems by establishing new institutions that will drive its actions.

With a population of 3.2 billion people, BRICS currently accounts for about 40 per cent of the world population of roughly eight billion. By the year 2050, the combined population is projected to rise to about 3.42 billion. That number, against a projected world population of some 9.7 billion people, will represent approximately 35 per cent of the world’s population as projected. This number will be made up of the current five members – Brazil, Russia, India, China, and South Africa.

At the end of the group’s meeting in South Africa last week, it extended an invitation to six countries to join the fold: Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates. These six nations will bring in an additional 582 million people in 27 years, led by Ethiopia and Egypt with projected 213.2 million and 159 million, respectively by then. With these, BRICS, whose name would most likely have changed by then, would account for roughly 41 per cent of the world’s population.

BRICS South Africa declaration: Making of world’s economic behemoth

BRICS South Africa declaration: Making of world’s economic behemoth

That is a huge chunk of the global market, both in terms of finished goods and raw materials for the world’s industries. Its membership would have captured strategic markets in different regions of the world: China and India in Central, Southern, and Eastern Asia; Russia in Eastern Europe, and  Egypt, Ethiopia, and South Africa, in Africa. In Latin America, two of the four biggest economies in that region, Brazil and Argentina, would be members of the group. It is the same in the Middle East, where three of the leading economies would become its members.

So, this group knows it’s gathering momentum, and this shows clearly in the declarations it made at the end of the meeting, held on African soil. After 15 years of existence, BRICS has sent a clear signal that it is ready to expand and capture the rest of the world that is currently not satisfied with the domineering powers of the West. It wants to take advantage of the realignments going on across the globe as nations and even regions seek greater protection midwifed by cooperative movements. From Africa to other regions of the world, nations prefer cooperation and collaboration to the imperialistic tendencies of former colonial masters, who still see free nations as their appendages.

And there is hardly any other region in the world today where this ferment is hotter than in Africa. This perhaps highlights the relevance of the theme of the summit, ‘BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development and Inclusive Multilateralism’.

Mutuality is key to the formulation and sustenance of a new world economic and social order. This is one element that has been lacking in the existing relationships among former colonies and their former lords. And it is not surprising that this is the leading cause of revolt and dissent among the former vassal states.  

So, when BRICS comes and flaunts “mutuality,” then Africa and other regions, including Latin America, would listen and seek to partake in this new fold. What it portends is a win-win partnership, where there will be no hierarchy of membership.

For many African countries, this possibility makes BRICS a more acceptable group to belong to. It will change the narrative of the continent’s resources being exploited by some foreign powers while hiding under various guises of trying to help such countries build infrastructure. Across Africa, decrepit infrastructure, from power to rail lines, is a big drag on economies. But under formalised rules of engagement, any form of unfair practices will be checkmated.

“We reiterate our support to the African Union Agenda 2063 and to Africa’s efforts towards integration, including through the operationalisation of the African Continental Free Trade Area. We underscore that the AfCFTA is poised to create a predictable environment for investments, particularly in infrastructure development, and provides an opportunity to find synergies with partners on cooperation, trade, and development on the African continent,” BRICS said.

Africa Agenda 2063, the realisation of which is 40 years away, is the grand plan to transform the continent into a global economic powerhouse by that date. No doubt, the attainment of this goal will require strategic partnerships across regions of the world. It will need purposeful exploitation of Africa’s abundant resources for the benefit of the citizens.

“We underline the importance of strengthening the partnership between BRICS and Africa to unlock mutually beneficial opportunities for increased trade, investment and infrastructure development.

“We stress the importance of issues including industrialization, infrastructure development, food security, agriculture modernisation for sustainable growth, health care, and tackling climate change for the sustainable development of Africa,” it said.

The message here is clear: BRICS is set to alter significantly the global business, trading, and financial systems, including the payments system. In this regard, the group outlined its plans to wrest the global economy from the current stranglehold of the dominant Western powers. Take, for instance, its plans for the payment and settlement systems.

“We stress the importance of encouraging the use of local currencies in international trade and financial transactions between BRICS as well as their trading partners. We also encourage strengthening of correspondent banking networks between the BRICS countries and enabling settlements in the local currencies,” the group said.

The group tasked member countries’ finance ministers and/or Central Bank governors, “as appropriate, to consider the issue of local currencies, payment instruments, and platforms and report back to us by the next summit.

If you are looking for a group that practises strategy, you find that in BRICS. Nine years ago, it set up a bank, the New Development Bank (NDB). The bank is promoting infrastructure and sustainable development of its member countries, according to the group.

“We recognise that infrastructure investments support human, social, environmental, and economic development. We note that the demand for infrastructure is growing, with a greater need for scale, innovation, and sustainability,” it said.

The picture is clear. There is a huge demand for investments in infrastructure and sustainable development projects in member countries. Given the long-term nature of infrastructure financing, and the inability of regular banks to fit into this, it is clear that NDB will play a major role in the development of African countries. 

Interestingly, BRICS is not following a solo programme for the group. It is strategically picking members who also belong to other global blocs, with obvious goals in view. For instance, by the time the six new countries invited to join the group formalise their membership, BRICS would have seven out of the members of the G20 group: Argentina, China, India, Brazil, Russia, Saudi Arabia, and South Africa.   

BRICS appreciates the role that the G20 forum continues to play as the premier multilateral forum in the field of international economic and financial cooperation that comprises both developed and emerging markets and developing countries where major economies jointly seek solutions to global challenges. This explains the group’s excitement over the roles that two of its members will play in the G20 over the three years.

“Therefore, we are committed to a balanced approach by continuing to amplify and further integrate the voice of the global South in the G20 agenda as under the Indian Presidency in 2023 and the Brazilian and South African presidencies in 2024 and 2025,” it said.

In all the analysis so far, one name that has been conspicuously missing is Nigeria! Whether as a current member or as a prospective member, Africa’s most populous country and biggest economy does not yet feature on the BRICS discussion. Many Africans, who want the country as a member, have wondered why Nigeria is not part of this new global move that many believe has a role to play in the emerging global economic and geopolitical realignment.

This is even more so when viewed against the background of the two African nations invited for membership of the group. Take for instance, Ethiopia. This North African country is currently embroiled in a civil war involving the Tigray and Amhara regions.

So, analysts ask: If BRICS could invite Ethiopia that is at war, what is wrong with Nigeria?

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