Photo: Gianluigi Guercia, AFP
The beginning of the new year has brought with it the official incorporation of Egypt, Iran, Saudi Arabia and the United Arab Emirates -in addition to Ethiopia- into the BRICS, the bloc of emerging economies that was born three decades ago and which, with these accessions, has doubled in size. Although only two weeks have passed since the agreement was signed on 1 January, the entry of some of the world's largest energy producers into this club is expected to have a major impact on its scope and functioning and, possibly, on global geopolitics. But let's first look at what this bloc is all about.
What are the BRICS? Similar in phonetics to the English word "bricks", BRICS is an intergovernmental organisation whose acronym stands for Brazil, Russia, India, China and South Africa, nations referred to in economic terms as emerging markets. The initial bloc was formed in 2009, with South Africa joining a year later. The initiative has had its detractors and supporters since its inception, but whatever one's point of view, a cursory look at the statistics alone can explain the logic behind the union. The original group of founding countries represents 42% of the world's population and 30% of the world's territory. It also contributes 231 TTP3T of the world's Gross Domestic Product and 181 TTP3T of international trade. So what is the purpose of this initiative?
Why was the bloc created? According to analysts, the main objective of this union is to serve as a catalyst for reforming the multilateral institutions created by the West after World War II that manage the global economic system, regulating free trade, finance, etc., such as the International Monetary Fund and the World Bank, among others.
Many countries of the so-called Global South feel that these institutions have become obsolete, as they do not represent their true weight and interests, thus hindering their fuller integration into the world economy. The BRICS aim to promote the reform of global governance, thus giving impetus to a multipolar world in which the Global South can play a more relevant role in accordance with its economic growth. In this sense, it is also important for the bloc to support the 'de-dollarisation' of the international monetary system, i.e., not relying exclusively on the dollar as a reserve currency and for international transactions, for example, by increasing bilateral trade in local currencies.
In short, it is an alliance that enhances common interests and multilateral cooperation to further open markets, encourage the exchange of technology and knowledge, promote investment, diversify economies and achieve greater integration into the world economy in a system that is more favourable to their interests.
If the 2008 financial crisis served as a spur to the creation of the BRICS, the war in Ukraine has spurred their further expansion by creating a new scenario of economic uncertainty. So what do the new members bring to the existing group?
Why has it expanded to North Africa and the Middle East?
Although more than twenty countries applied or expressed interest in joining the BRICS, this time only five of them have been officially admitted (Argentina was also invited, but the incoming government of Javier Milei declined to join the bloc). While the exact criteria for the selection of the five new additions to the BRICS -now called BRICS Plus- are unknown, again a look at the characteristics of the chosen countries may help explain the logic of the choice.
Both Saudi Arabia and the United Arab Emirates are major exporters of energy to Asian consumers, and Iran is a major exporter of oil and gas. Egypt, in addition to being a strategic ally in the region, controls the Suez Canal, a critical infrastructure for global trade, as we are seeing these days with the Red Sea crisis. Ethiopia, in addition to being the most populous country in East Africa, has experienced rapid growth in recent years. All of them contribute significantly to the bloc, while hoping to benefit from an alliance whose value and level of economic activity is increasing all the time. But what impact will this enlargement have politically, economically, regionally and even globally?
What is the potential impact of this enlargement?
While it is still too early to draw definitive conclusions about the future impact of BRICS expansion into North Africa and the Middle East, it seems clear that the very fact of its occurrence is having reverberations in regional and even global geopolitical calculations. The debate has been further spurred by the fact that other countries in the region - including Algeria, Bahrain and Kuwait - have also applied for formal membership. At the regional level, the debate is also about the future of other associations such as the Arab League and the Gulf Cooperation Council. From the point of view of international relations, the strengthening and expansion of the BRICS is a further indication that the emergence of a multipolar world is already a reality that is hard to ignore.