Expanded BRICS and Geoeconomic Implications for Africa

The BRICS bloc of leading emerging economies made a major decision in expanding its reach and influence by announcing that six more countries — Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates — have been invited to join BRICS as new members (1). This takes the total number of nations within the grouping to 11, effective January 1, 2024.

The bloc, initially formed in 2009 with Brazil, Russia, India and China, first expanded in 2010 to admit South Africa. After 23 years, the bloc has now sought to grow a stronger coalition of developing nations that can better put the interests of the Global South on the world map. Before the start of its annual Summit in Johannesburg, South Africa on August 22, more than 40 countries expressed interest in joining BRICS, and 23 formally applied to join it.

“We appreciate the considerable interest shown by countries of the Global South in membership of BRICS,” the bloc said in the Johannesburg II Declaration (2) it adopted on August 24, the final day of the Summit. The statement further added that the six new nations were selected after “BRICS countries reached consensus on the guiding principles, standards, criteria and procedures of the BRICS expansion process.” Some analysts, however, have highlighted that no commonalities exist among the six countries invited to join BRICS other than that they are each significant nation-states in their regions.

The expansion of BRICS has clear geoeconomic, geostrategic and geopolitical implications as the latest additions will push some BRICS nations to think more about their geospatial policies and push China and India to beef up the existing policies. It may be recalled that China recently brokered the reestablishment of ties between Saudi Arabia and Iran, a role that would traditionally have been filled by a country like the United States.

On the other hand, India recently signed an agreement with the UAE to trade in Indian rupees and Emirati dirhams instead of in the US dollar (3). BRICS has vocally challenged the use of instruments by Western nations as unilateral economic and trade sanctions against countries, such as those implemented against Russia as a result of the war in Ukraine, and the continued dominance of the US dollar in global trade.

This shift could increase the potential for using currencies other than the US dollar, particularly by creating a network of countries that enhances the utility of their respective currencies. Argentina for instance, was touted as a “shoe-in” to join the bloc as its inclusion was championed by Brazil, China and India.

Among the African states, it was expected that Algeria, which has oil reserves, or Nigeria, which is the continent’s most populous country and leading economy, could have been given a berth in the new membership of the bloc. Nigeria’s exclusion appears to be an indictment of its foreign policy, or the lack thereof, as it used to be pan-African in its foreign policy but has seemed to change over time.

One thing that is clear is that most of the rest of Africa – with the potential exception of Nigeria and Kenya – is moving away from the West and toward the East. The inclusion of Ethiopia, a country with one of the fastest-growing economies and that also hosts the headquarters of the African Union, has firmly put the African continent front and center with economic benefits widely seen to be accruing to the continent over time.

Egypt, Saudi Arabia and the UAE are similar to India and, to some degree, South Africa in that these are countries that have one foot in BRICS and another foot in the West, with Saudi Arabia “positioning” itself as not just in the American camp. It remains to be seen, however, what an expanded BRICS means to the West and what it denotes for the current global order and governance.

With the addition of six more nations, the bloc now represents a larger share of the world’s population and economy. However, this just means that the group is only potentially a powerful voice for reform of the arrangements for global governance and a powerful actor in these mechanisms.

Whether it actually becomes such a voice will depend on whether the expanded group is more effective than the BRICS in its original format in forging agreements on how the arrangements for global governance should be reformed and how they can more effectively serve the interests of the entire Global South. The answer to this will become clear in the years to come as the interplay between the 11 member nations evolves and develops.

The expanded BRICS assumes greater significance due to the inclusion of African nations given that there is now a firm recognition among the comity of nations of the important role the African continent would play not just for the global order and governance but for the growth and development of the global economy.

With most nations in the Global North either slowing down economically or getting stuck in geopolitical crosswires, the African continent is emerging as an important region that, despite its challenges, shows signs of resilience and growth prospects that offer a new ray of hope for the international community.

Initial BRICS members have also been a part of the G20 grouping, which is currently chaired by India with the presidency rotating to Brazil for the year 2024. The expansion mechanism is bound to elevate India’s advocacy for Africa’s inclusion into the G20 to further strengthen the voice of the Global South and sharpen the focus on reforms of multilateral institutions such as the IMF and World Bank and the UN system and mechanism itself.

The BRICS bloc initiated and successfully implemented banking systems with the National Development Bank in Shanghai and AIIB in Beijing and firmly put the focus on development financing, a challenge that developing economies have always faced because of liquidity issues in their infrastructure projects and structural planning. India and China both hold a sizeable equity in both of the development-oriented banks and have successfully funded infrastructure projects in developing economies, the results of which are quite visible in the developmental trajectory of nations in the Global South that previously remained behind due to the lack of development financing.

The issue of global food security puts the focus on Africa. A continent with arable land of 350 million hectares but using only 10 million of those hectares due to the lack of technical support and access to finances, Africa could well be a breadbasket for the world. Fast-paced, technological product and service development at lower rates and an emerging informal economy are leading the African continent to a mini-revolution of sorts, with the African youth population driving digital innovation.

The BRICS expansion including nations from the MENA region is a powerful message to the Global North concerning the future where development, governance, technology and innovation will be the driving themes. Over time, with G20 expansion on the agenda and the inclusion of the African Union, the African continent is slated to play a more dominant and decisive role in reshaping global growth and development for shared prosperity for the international community.

While Africa’s role will become increasingly vital on the world stage as a solution provider, the continent will need to safeguard itself against falling into conflicts, debt traps and territorial disputes that could potentially hinder its march toward growth, prosperity, stability and peaceful coexistence. It is widely anticipated that Africa’s role in the regional and global geoeconomics and stabilization process will hold the ground leading up to the end of the 21st century.

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Pooran Pandey is a Non-Resident Fellow – Sustainable Development at Nkafu Policy Institute. Contributor to (Springer Nature, Germany) first global encyclopedia on United Nations Sustainable Development Goals (2019), Pooran Chandra Pandey is also the founding CEO of the Dialogue of Civilizations Research Institute, a Berlin, Germany, based international think tank (2016-2018)

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