Opinion: BRICS summit 2023 – global power shift in the making?

(Opinion) Next week’s BRICS Summit in Johannesburg, South Africa, will witness the participation of delegations not just from member countries Brazil, Russia, India, China, and South Africa, but also Bolivia and Argentina.

There’s heightened global interest in this year’s assembly, partly due to speculation regarding Russian President Vladimir Putin’s presence, who will ultimately attend virtually, and the increasing number of countries showing interest in joining the bloc.

South Africa, the host, reports over 40 countries have expressed a desire to join, including Saudi Arabia, Indonesia, and the UAE.

Since its inception in 2009, BRICS has had disagreements but continues its dialogue on varied topics like health, economy, and agriculture.

They share a vision of transitioning to a world where the U.S. is not the sole dominant power.

After Russia invaded Ukraine, Western countries sought to economically and politically isolate Moscow.

However, numerous nations in the Global South opposed this, driven by economic interests and frustrations over perceived double standards in global governance.

The West’s support for Ukraine, including over US$100 billion in direct aid, has solidified NATO’s and the West’s global influence.

Meanwhile, the rising interest in BRICS membership reinforces its core objective: promoting a multipolar world.

One significant achievement of BRICS was establishing the New Development Bank (NDB) in 2015.

Unlike the World Bank, developing countries have a larger say in NDB, and some loans are offered in local currencies instead of US dollars.

In May, NDB’s president, former Brazilian president Dilma Rousseff, revealed aims to allocate around 30% of their loans in member countries’ currencies by 2026, protecting against US dollar fluctuations.

The NDB’s appeal reflects both criticism of large multilateral financial institutions and a desire to bridge the funding gap.

For instance, estimates from 2021 indicated that Latin America and the Caribbean would need US$2.2 trillion in infrastructure investments to meet the UN’s Sustainable Development Goals by 2030.

However, the World Bank allocated only about US$70 billion globally in the past year, not all for infrastructure.

Challenges arose for NDB post Russia’s invasion of Ukraine, leading to increased dollar procurement costs.

A potential solution lies in further utilizing non-dollar currencies, offering insulation against possible future U.S. sanctions.

The NDB recently welcomed Bangladesh, Egypt, the UAE, and Uruguay as members and is in talks with other potential members.

The BRICS bloc’s expanding interest suggests a shift toward a more evenly distributed global power.

As scholars Juan Gabriel Tokatlian and Monica Hirst observed, there’s a growing sentiment in the Global South that moving away from dollar dependency signifies a step toward a multipolar world.