Tran Minh Duc

11221413

International Economics 64A

National Economics University

BRICS_1: Introduction, significance, and origins

-​ Definition and purpose: BRICS is an informal grouping of emerging

economies - Brazil, Russia, India, China, and South Africa - established in
2009 to counter what members view as excessive Western dominance of
international institutions and to better serve developing countries. The bloc
seeks to coordinate members’ economic and diplomatic policies, build new
financial institutions, and reduce reliance on the U.S. dollar.
-​ 2025 Summit: The 2025 BRICS summit is scheduled for July 6–7 in Rio de
Janeiro, Brazil, and will focus on reforms to global governance and
cooperation across the Global South. Cooperation remains fragile, as the
leaders of both China and Russia have indicated they will not travel to Rio
for the annual meeting.
-​ Why BRICS matters: While expanding membership enhances visibility and
potential influence, it also introduces challenges, including increased
pushback from Western countries and growing internal divisions. Observers
note that how BRICS manages these tensions will determine whether it can
present a more unified voice globally.
-​ Origins and expansion: A major expansion wave came at the 2023 BRICS
Summit, with invitations to Argentina, Egypt, Ethiopia, Iran, Saudi Arabia,
and the United Arab Emirates (UAE). All accepted except Argentina, whose
president redirected the country toward a pro‑Western stance. Saudi Arabia
has engaged with the membership process but has not provided a definitive
finalization. Indonesia subsequently joined as the newest member last year.
-​ Partner countries: In 2024, BRICS created a new “partner countries”
category. The first cohort included Belarus, Bolivia, Cuba, Kazakhstan,
Malaysia, Nigeria, Thailand, Uganda, and Uzbekistan. While short of full
membership, this status allows participation in BRICS summits.

BRICS_2 : What BRICS does: structure, agenda, and alternative finance

 -​ Organizational form: BRICS leaders meet annually, with the chair rotating
each year to set priorities and host the summit. Decision-making is
consensus-based, and the grouping remains largely informal - without a
charter, secretariat, or common funds.
-​ Global representation: BRICS aims to present a united front of emerging
economy perspectives in multilateral institutions, including advocating for
reforms such as expanding the UN Security Council and forming negotiating
blocs. Many BRICS members opposed the UN condemnation of Russia’s
war in Ukraine and have sought common positions on issues including the
Iran nuclear program and conflicts in Afghanistan, Gaza, Libya, and Syria.
-​ Economic coordination: In the aftermath of the 2008 global recession,
BRICS emphasized coordination on tariff policy, export restrictions for
critical resources, and investment. Annual FDI inflows into BRICS rose
significantly from 2001 to 2021, though growth has slowed in recent years.
-​ Alternative finance: BRICS created the New Development Bank (NDB) and
the Contingent Reserve Arrangement (CRA), modeled on the World Bank
and the IMF respectively, with the aim of revitalizing South–South
cooperation and reducing dependence on traditional sources of finance.
-​ Critique of Bretton Woods: The NDB and CRA were conceived as
complements or alternatives to the post‑WWII Bretton Woods system. Many
in the Global South argue that the World Bank and IMF inadequately serve
poorer countries. UN Secretary‑General António Guterres has remarked that
the system was designed by and for rich countries, with virtually no African
country at the negotiating table at Bretton Woods.
-​ Constraints and criticisms: The NDB is far smaller than the World Bank and
is unlikely to replace it. Critics argue its ambitions to innovate have fallen
short, with many practices mirroring incumbent institutions. It has also faced
criticism for vague environmental and social safeguards.

BRICS_3: Dollar dependence, internal divisions, and the Ukraine war

-​ Can a BRICS currency replace the dollar? BRICS has spent over a decade
seeking to reduce the U.S. dollar’s role in international trade, primarily by
expanding the use of national currencies in bilateral transactions. Proposals
include introducing a BRICS‑wide currency - championed by Brazil’s
President Luiz Inácio Lula da Silva - creating a new cryptocurrency, or using
 a composite basket of BRICS currencies. In practice, the thrust is
diversification rather than immediate replacement of the dollar.
-​ What divides BRICS members? Beyond implementation challenges, BRICS
faces internal rivalries. China and India have seen rising tensions over a
longstanding border dispute and broader economic and geopolitical
competition. Decision‑making has proven difficult; for example, at a foreign
ministers’ meeting in New York in September 2024, the group sought a
model to streamline additions to the UN Security Council but failed to reach
agreement.
-​ Impact of Russia’s invasion of Ukraine: The war deepened fissures,
triggering widespread condemnation, Western‑led sanctions, and diplomatic
pressure to limit trade with Russia, unsettling BRICS partners. An
International Criminal Court arrest warrant for President Putin complicated
the 2023 BRICS forum - he stayed home to avoid potential arrest by ICC
member South Africa - while hosting the summit in Russia in 2024 avoided
that issue. Most BRICS members have adopted varying degrees of neutrality
or non‑alignment, while others have largely ignored sanctions. Some analysts
argue Western sanctions and related necessities have, paradoxically, nudged
BRICS members closer together.
-​ Domestic fragilities: Economic and political instability within members -
years‑long recessions, corruption, and deteriorating infrastructure in Brazil
and South Africa; China’s growth slowdown - pose risks. Additional fault
lines include divides between democracies and autocracies and long‑standing
regional rivalries (e.g., Saudi Arabia–Iran, Egypt–Ethiopia).
-​ Prompts in file: Proposals to reduce reliance on the U.S. dollar include using
local currencies, exploring a currency basket, and considering a
cryptocurrency. Russia’s invasion of Ukraine has complicated unity,
intensifying diplomatic and legal challenges while also catalyzing certain
pragmatic forms of cooperation.

BRICS_4: Rationale and risks of expansion; decision-making

-​ Why expansion? The push to expand membership is itself a fault line. China
and Russia favor expansion, while Brazil and India are cautious, worried it
could dilute their influence. India’s intensifying rivalry with China reinforces
its desire not to amplify China’s power by adding countries seen as closer to
Beijing.
 -​ Role of Gulf states: The addition of Saudi Arabia and the UAE would bring
the Arab world’s largest economies and the world’s second and eighth‑largest
oil producers, respectively. Both also act as mediators in various regions
(e.g., Saudi Arabia in Sudan and Ukraine talks; the UAE hosting
India–Pakistan stability talks). Yet some experts warn that Saudi–UAE
rivalry could spill into BRICS. Others suggest both countries seek BRICS
membership to enhance their global leverage.
-​ Global South perceptions: As one analyst from the German Institute for
International and Security Affairs notes, Western appeals to “values‑based
partnerships” and “rules‑based multilateralism” ring hollow if they ignore the
Global South’s desire to change the rules themselves in finance, trade, and
standard‑setting - precisely the areas where BRICS seeks to exert influence.
-​ How BRICS decides: Decision‑making is by consensus, consistent with the
bloc’s informality and flexible, “loose” institutional design.

Notes on gaps and ambiguities

-​ Some passages in the source materials contain elisions or missing phrases

(e.g., direct quotations about Argentina’s reversal or Saudi Arabia’s
membership formalization). These omissions do not alter the overall
meaning: expansion is a strategic goal but remains uneven and politically
contingent.
-​ The materials consistently emphasize that, while BRICS aspires to reshape
global rules and reduce dollar dependence, practical constraints, internal
divisions, limited institutional capacity, and geopolitical shocks - temper
near‑term ambitions. The NDB/CRA are best viewed as complementary
options rather than immediate substitutes for Bretton Woods institutions.