The BRICS group, an emerging global alliance, is formulating strategies to influence the current economic system, with a goal to decrease the US Dollar's global predominance. This group’s strategy, centered on economic balance, potentially initiates a novel period in the international economic ecosystem.
A New Economic Alliance for the BRICS
The expansion of the BRICS group - Brazil, Russia, India, China, and South Africa, along with potential members, signals a substantial shift in global economic dynamics. Added to this group is Nigeria, which has shown interest, showcasing a broader dissatisfaction with Western economic dominance. Muda Yusuf of Nigeria’s Center for the Promotion of Private Enterprise, discusses this scenario pointing out the potential benefits BRICS could offer in order to achieve a more well-balanced global economy.
In 2023, BRICS experienced substantial growth and increased influence. Earlier considered a secondary entity on the global stage, it has now become a significant player, challenging the conventional order and suggesting significant changes. These changes involve a significant idea: substituting the US Dollar with different currencies in global transactions to stabilize the global economy.
Yusuf elaborates on the need for a multipolar world, underlining the need for an economic framework that mirrors the diversity of worldwide powers. This perspective aligns with the group’s broader aim of establishing a more equitable global order, especially for countries in the Global South, which have been under western dominance for a long time.
Shifting Global Paradigms
The BRICS group is more than just an economic alliance; it expresses opposition against the unilateralism of the West. The alignment's divergence with the US extends to its foreign policy, particularly its stance on the Israeli-Palestinian conflict and its approach towards Russia and Ukraine. Comparatively, China, through initiatives like the Global Security Initiative, has been advancing in promoting peace and sustainable growth, as demonstrated by its role in normalizing relations between Iran and Saudi Arabia.
Recently, BRICS expanded to include new members like Egypt, Ethiopia, Iran, Saudi Arabia, and the UAE, enhancing its global influence. This expansion signifies more than just an increase in numbers; it is a strategic step towards creating a more balanced global economic scenario. The induction of these new members could shift the group's percentage of global GDP to a dominant 36 percent, and extend its demographic reach to nearly half of the world's population.
This growth is accompanied by efforts to establish fairer trade and financial systems, less affected by Western influence. The use of the US dollar as a tool, as seen in the imposition of sanctions and trade barriers, has been a critical factor prompting this shift. BRICS aims to challenge this notion by advocating trade in alternative currencies, potentially reducing the Dollar's supremacy as the primary international currency.
Nevertheless, the internal relations within BRICS portray a complex scenario. The diversity of its members in terms of their economic models, political systems, and regional interests pose substantial challenges to the alliance's coherence and effectiveness. Despite these challenges, BRICS has made progress in certain domains, like infrastructure finance through the New Development Bank.
Under Russia's current presidency, the BRICS alliance is expected to concentrate on areas that resonate with its members' shared interests, such as reducing reliance on the US dollar and augmenting trade independence. Even though the expansion of BRICS does not immediately convert it into a unified counterbalance to the West, it undoubtedly reduces Western influence over individual member countries.
The BRICS group's strategy to reduce the Dollar's dominance is not only an economic strategy but also a geopolitical move reflecting fluctuating power dynamics in the global order. Even though the path forward contains challenges and contradictions, the group's determination to build a multipolar world is evident. Whether this venture will remodel global economics and politics remains uncertain. However, one thing is clear: the BRICS group is determined to play a prominent role in a world currently dominated by Western powers.
