The BRICS status and role in global governance

An in-depth analysis of how BRICS came into being and where its future lies

Many people compare BRICS to NATO or the UN, which is incorrect: this organization has no headquarters; has nothing to do with military arrangements, and deals mainly with economic issues.

BRICS unites the efforts of countries seeking to overcome Western imperialist-economic hegemony on the path of strengthening economic integration and developing economic activities.

BRICS comprises five countries, namely Brazil, Russia, India, the People's Republic of China and the Republic of South Africa (which joined in 2011). BRICS is the acronym composed of the first letters of the countries' names in English.

The economic systems of the organisation’s members have a huge impact on markets.

The People's Republic of China ranks first in the world in terms of GDP; it exports most goods and has the largest foreign exchange reserves in the world.  

India ranks third in terms of GDP and is the most populous country on the planet; it has very high-profile and inexpensive intellectual resources, hence huge human resources.

Russia ranks fifth in terms of GDP; the largest reserves of mineral resources are concentrated in its territory.

Brazil ranks eighth in the world in terms of GDP and has enormous potential for agriculture.

South Africa ranks 30th in terms of GDP and has rich natural resources.

All the countries included in the grouping are united by a global concept, namely their developing economies. Some experts suggest that other States whose economic indicators are rising will join BRICS in the future.

After the BRICS Summit held in June 2022, Iran and Argentina applied to join the organization, and later Saudi Arabia, Egypt, the United Arab Emirates and Ethiopia followed suit.

The organization has ambitious goals:

1) to reduce the consequences of the global economic crisis;

2) to improve the population’s quality of life;

3) to advocate a gradual transition to high technologies in the broadest possible sectors.

BRICS has gradually transformed into a strategic community in many areas, the basis of which is political activity and the foundations of security, the economic and financial sphere, cultural management and cooperation in the humanitarian sphere.

The participating countries respect equality and maintain mutual respect. As said above, the organisation has no masters, headquarters, secretary general, rules or statutes.

The Republic of South Africa is the weakest of the participating countries in terms of GDP. South Africa was the last country to join the original grouping.

The term BRIC was originally coined in 2001 (as we will see later, the letter "S" was added after the entry of South Africa) by Goldman Sachs economist Jim O'Neill, Honorary Professor at the University of Manchester, in his report Building Better Global Economic BRIC (in Global Economics Paper, issue No. 66).

He applied it to the countries deemed to be the fastest developing ones. The new acronym has become common practice for the companies investing in the economies of these five countries.

In 2006, Dow Jones included the BRIC-50 index in an instrument package that included large companies in the People's Republic of China, India, Brazil and Russia with the most popular shares on the Stock Exchange.

The first official BRIC meeting took place during the United Nations Assembly at the UN headquarters in New York in 2006. The leaders of the four countries adopted a plan for developing cooperation in various fields.

Two years later, at Russia’s suggestion, a separate dialogue between the Heads of State and government of the Russian Federation, Brazil, the People's Republic of China and India was held in Japan as part of the G8 Conference, as a result of which key cooperation agreements on a number of important economic issues were obtained.

In 2011 South Africa joined the four original countries and the grouping was also renamed BRICS, officially adding the letter "S" standing for South Africa to reflect the organisation’s expanded membership.

Over the entire period of its existence, 15 Summits were held, including an online one in 2021, also with the participation of leaders from countries outside the organization.

BRICS leaders decided to invite six more countries to join their alliance, namely Argentina, Saudi Arabia, Egypt, the United Arab Emirates, Ethiopia, and Iran. They were all invited to become BRICS members (and their full membership is scheduled to take effect on 1 January 2024). Their accession took place at the 15th Summit held in Johannesburg last 22-24 August, the first to be hosted in person since the onset of the COVID-19 pandemic.

Matamela Cyril Ramaphosa, South African President since February 2018, said: “We appreciate other countries’ interest in building a partnership with BRICS. We have instructed our Foreign Ministers to further develop the BRICS partner country model and a list of potential partner countries and report back by the next Summit."

The decision to enlarge the grouping reflects the will of the current BRICS allies, which together account for 37.3 percent of global GDP. In this way, BRICS also strengthens its representation in regions such as the Middle East and Africa.

Earlier August it was also reported that more than 40 countries had shown interest in joining BRICS, including 22 that had formally applied to join.

The organization also plans to launch its own payment system, which can be used in the participating countries.

With specific reference to organization, goals, activities and leadership, a major leaders' meeting is held each year in one of the organisation’s Member States. This tradition dates back to 2009, as early as the first Summit.

Since 2014, an interesting pattern can be traced: the Summit is held in the country whose letter is in the front row, namely Brazil, Russia, etc.

At the first meeting, State leaders defined the partnership’s goal as "consistent, proactive, pragmatic, open and transparent dialogue and cooperation." Furthermore, the construction of a harmonious world and prosperity were chosen as the principles of the organization.

In addition to the Summits where the Heads of State and government meet, more than twenty negotiation schemes are used under the BRICS auspices. These are all kinds of forums, Ministers’ meetings and other forms of cooperation.

The range of topics discussed at the meetings covers almost all aspects of life: global warming; poverty eradication; international financial activities; social development and many others.

The organisation has no permanent President: the work is coordinated by the organizing country for the entire year of its Presidency. Important decisions have recently been taken in negotiations, particularly agreements on strong cooperation in the areas of energy, health, science and technology.

For example, during the 7th Summit held in Ufa (Russia, 9 July 2015), the economic concept of the organization was adopted, and priority was given to agriculture, trade, investment, and mineral raw materials.

During its Presidency since February 2017, the People's Republic of China identified, as its main task, the promotion of the BRICS+ format to attract a large number of non-participating countries to the organization.

To this end, the Heads of State and government of several non-participating countries are invited to Summits and other meetings. It is assumed that this scheme will help create a wide network of partners for strong and permanent cooperation.

The organization's work is not limited to the annual meeting of Heads of State and government. Numerous associations in various fields operate within the organization, carrying out the tasks set at the Summit. The BRICS activities are carried out by separate structures established at different times.

It is believed that by strengthening the BRICS’ authority, the United States intends to increase pressure on the organisation's Member States not to lose the status of technological and productive hub.

Since 2015 the organization has been operating and managing a Shanghai-based development bank (New Development Bank) as an alternative to the International Monetary Fund. It has $100 billion in equity capital, which finances projects to create, expand and improve infrastructure in the Fund's Member States. Plans include the creation of the BRICS payment system to be used in the territories of participating countries.

Again in 2015, the Foreign Exchange Reserve Pool was created. Its volume of resources amounts to $100 billion and was created to reduce the consequences of unforeseen situations.

The organisation operates a Network University, established in 2015, which two years later launched seven Master's programs. The University is based on existing universities in participating countries - more than 10 in Russia - and its headquarters are located at Ural Federal University.

The "BRICS Journal of Economics" is also published, i.e. a peer-reviewed, open-access journal covering major economic issues in middle-income developing countries, mainly BRICS ones. A TV channel is also operated.

During large-scale events, namely Summits, Heads of State and government discuss global problems around the world. These are issues related to culture, agriculture, living standards, science, finance and politics.

All the participating countries differ in terms of wealth, social development and science, but they have one thing in common, i.e. the high rates of economic development in the BRICS countries.

The grouping has global goals that seek to improve the economic relations of our world. This is the reason why working groups are created to conduct research and make informed decisions to remove problems.

The BRICS grouping has ambitious plans. As early as reading the 2007 Second Report, it was predicted that India would experience unprecedented growth: experts believe that the Indian economy will far surpass the U.S. economy by 2043.

Experts also believe that the People's Republic of China, as well as India, will become world leaders in the supply of manufactured goods. These countries are expected to rank first in terms of supplying services. In these forecasts, Russia and Brazil are assigned the role of the world's leading suppliers of raw materials.

Such economic unification of countries does not ensure, but offers the possibility for the emergence of a strong bloc with valid authoritativeness. With the participating countries leading the way in many areas, the United States may be at a disadvantage and lose its role as a technology, production and consumption hub.

The BRICS grouping is further committed to improving the lives of each of its citizens. This may happen slowly, but the organization is doing an extraordinary job in this regard.

As for the weak Italian governments, they are afraid - even physically - that any international political-economic initiative may hurt the US President’s feelings.

Let us hope that at least the will of small and medium-sized enterprises - the basis of Italy’s traditional progress and knowledge in the world - will find glimmers and moments of respite so that fruitful contacts with the BRICS can be established, which will foster and increase GDP and benefits for our country.

To end with statistics (see the diagram below), we can see that as of January 1, 2024, the BRICS population will account for 45.6 percent of the world’s population, and the BRICS surface will cover 31.5 percent of the land area. World population: (BRICS: 45.6%) Land surface: 148.940.000 (BRICS: 31.5%) Data, updated on 26 November 2023

Professor Giancarlo Elia Valori is a world-renowned Italian economist and international relations expert, who serves as the President of the International Studies and Geopolitics Foundation, International World Group, Global Strategic Business In 1995, the Hebrew University of Jerusalem dedicated the Giancarlo Elia Valori chair of Peace and Regional Cooperation. Prof. Valori also holds chairs for Peace Studies at Yeshiva University in New York and at Peking University in China. Among his many honors from countries and institutions around the world, Prof. Valori is an Honorable of the Academy of Science at the Institute of France, Knight Grand Cross, Knight of Labor of the Italian Republic, Honorary Professor at the Peking University.




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