In recent years, the term BRICS has been widely circulated throughout the realm of international relations. BRICS – an acronym for Brazil, Russia, India, China, and South Africa – refers to the biggest rising powers in the 21st Century. The current shift in the global system poses an opportunity for non-Western countries but has been perceived as a major threat to Western powers who have enjoyed hegemonic dominance for centuries.
The term “BRIC” was coined in 2001 by Goldman Sachs economist Jim O’Neill, who claimed that these four major economies would dominate the world by 2050. In 2010, South Africa was added to this grouping because of its economic potential, economic ties with China, and to serve as a “gateway” to the rest of Africa. Thus, in 2010, the term BRICS was created.
Why are BRICS countries important?
First, the BRICS countries make up a substantial percentage of the world, in terms of economics and population. As of 2018, these five countries accounted for about 23% of the world’s GDP, 42% of the world population, 30% of the world’s land, and 18% of global trade. In comparison, the US accounts for 15% of global GDP and 4% of the population.
Despite their massive weight, Western countries have not listened to BRICS’ calls to reform economic institutions such as the International Monetary Fund (IMF) and the World Bank. These two institutions were created after World War Two to promote free market economies in the developing world through loans and economic assistance. But in order to do business with these institutions, states have to pay a heavy cost. To acquire a loan from the IMF, a state has to agree to certain conditionalities known as “structural adjustment” policies which include removing state barriers to foreign investment and capital flows, a privatization of state enterprises, and liberalization of trade and currency policy. The loans also come with extremely high interest rates that are almost impossible to pay back. The conditionalities tied to an IMF loan force a state to open up its market to the international community even if it is not in an economically competitive place to do so. In some cases, a mixed market would be more beneficial for developing states, with some industries protected by the government, but the IMF does not account for that.
In addition to pressuring countries to open their markets to free trade where more developed industries would dominate the less industrialized economies, the voting process also heavily favours developed countries. In the IMF, the US holds 16.51% of the voting share, while BRICS countries hold 14.6% combined. Similarly, in the International Bank for Reconstruction and Development, a section of the World Bank, the US holds 15.76% of the votes and BRICS holds 13.29%.
But instead of waiting around for a change that might not happen, BRICS have created their own institutions such as the annual BRICS Summit, New Development Bank (NDB), and the China-led Asian Infrastructure Investment Bank (AIIB). These institutions were created with the intention to fill the gaps of the post-World War Two system that have been ignored for decades. Now that countries besides the United States have the economic capacity to do this, the West has become increasingly wary of changes to the international economic order.
In addition, the BRICS countries strongly oppose the United Nations’ Responsibility to Protect (R2P) resolution which was passed to allow the global community to breach a country’s sovereignty if they are committing crimes against humanity. This is worrisome as China’s oppression of the Uigher population in Xinjiang shows it is not above violating human rights. But centuries of oppressing people of colour and continuous systematic racism doesn’t quite put the United States on the moral high ground…
What does it mean for the future?
While you’re not going to wake up one morning to discover that BRICS has suddenly taken over the world, you will certainly observe significant changes throughout your lifetime. First, the liberal international order, characterized by free markets and Western domination, is going to be challenged by developing countries as long as they are systematically put at a disadvantage.
Ironically, we are currently seeing the United States under the Trump administration also turn against its own system. But other Western countries continue to stand by liberal democratic beliefs.
Despite attempts from the West to spread democracy globally, it is not a “one size fits all” system. If democracy is truly the key to a prosperous economy, why have countries such as Tunisia, Zimbabwe, and Angola not seen consistent economic growth since transitioning to democracies?
As China is not a democracy and does not champion liberal values, it is trying to change the rules. When China lends money through the NDB and AIIB, it does not push a specific political and economic system on borrowing countries like the IMF pushes democracy. Even though doing business with China means agreeing to turn a blind eye to China’s human rights abuses and supporting the One China Policy, developing countries could start to choose these new institutions over the outdated Western ones. China’s unique political and economic history has led the country to encourage pragmatic development models that work for each individual country. Of course, it is debated whether China is doing this to gain regional influence and allies, but that is a different topic.
Brazil, Russia, India, China, and South Africa are important rising powers, both regionally and globally. Their actions and motivations are scrutinized by Western scholars and policymakers attempting to predict what the world’s future might look like. There are countless theories in international relations that help frame these predictions, though it is impossible to know exactly what the future holds. One thing we do know for sure is that the influence of non-Western countries is on the rise. No matter how hard the West tries, there is no blowing down a house made of BRICS.
Read More:
The BRICS Information Portal is a comprehensive source for information on the BRICS countries. Read here.
Listen:
The University of Manchester Global Development Institute created a podcast series “Rising Powers Special: The BRICs Uncovered.” Listen here.
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