{"id":244577,"date":"2023-09-25T12:01:56","date_gmt":"2023-09-25T11:01:56","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=244577"},"modified":"2023-09-23T06:12:28","modified_gmt":"2023-09-23T05:12:28","slug":"brics-experts-explain-what-the-strategic-entry-of-six-new-nations-means-for-bloc","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2023\/09\/brics-experts-explain-what-the-strategic-entry-of-six-new-nations-means-for-bloc\/","title":{"rendered":"BRICS+: Experts Explain What the Strategic Entry of Six New Nations Means for Bloc"},"content":{"rendered":"

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19 Sep 2023 <\/em>– BRICS, the bloc of emerging economies comprising Brazil, Russia, India, China and South Africa \u2013 announced the admission of six new members to the group at the conclusion of the bloc\u2019s 15th annual summit in Johannesburg last Thursday [14 Sep].<\/p>\n

More than two dozen countries had applied, both formally and informally, to join the bloc, but the group\u2019s leaders extended membership only to Saudi Arabia, UAE, Iran, Egypt, Ethiopia and Argentina for now.<\/p>\n

If they accept the invitation, these six new countries will become active BRICS+ members from January 2024.<\/p>\n

According to experts, the expansion of BRICS is a calculated move by the bloc\u2019s leaders, and there is a strong strategic reasoning behind inviting each of the six countries to the group, which will now be known as BRICS+.<\/p>\n

\u201cThe BRICS seemed to have moved in a way that is poised to maximize their economic heft,\u201d former White House economist Jo Sullivan told Al Arabiya English.<\/p>\n

\u201cMost of these countries are either key commodity producers, like Saudi Arabia and the UAE, or in the case of Ethiopia and Egypt, they are on the Red Sea that connects to the Suez Canal, which is a huge point of transit for a large range of commodities,\u201d he added.<\/p>\n

Why these six countries?<\/p>\n

One of the prominent goals of BRICS is to enhance cross-border trade among member nations to boost the group economically and reduce the bloc\u2019s reliance on the US dollar.<\/p>\n

According to experts, BRICS invited Saudi Arabia and the UAE in view of their enormous wealth and abundant fossil fuels. Saudi Arabia is also one of the leading holders of US treasury debt \u2013 the national debt of the United States issued in bonds.<\/p>\n

On the other hand, Egypt and Ethiopia share an advantageous location on the Red Sea near the Suez, a major route for global trade. The two nations are also regional powers in Africa. Iran \u2013 one of the most \u201cinteresting\u201d choices according to many scholars \u2013 can assist BRICS with its vast knowledge and experience in conducting international trade while sidestepping Western sanctions.<\/p>\n

\u201cThere are practically no economies that have been sanctioned as heavily as the Iranian economy by the US,\u201d Sullivan said.<\/p>\n

According to Sullivan, the inclusion of Iran will be a pointer towards the bloc\u2019s seriousness in either dodging the impact of any future US sanctions or its ability to mitigate that blow, if and when it implements de-dollarization \u2013 a move away from the US dollar. Iran\u2019s President Ebrahim Raisi also expressed his support for BRICS\u2019s efforts to de-dollarize at last week\u2019s summit.<\/p>\n

\u201cThe Islamic Republic of Iran very resolutely supports the successful endeavors of BRICS, in line with de-dollarization from the trade and economic interactions between the members and also making use of local currencies,\u201d he said.<\/p>\n

Russia is already dealing with sanctions due to the ongoing Ukraine war, while India and China have had their own flirtations with US-imposed restrictions in the past. From that perspective, Iran may be the \u201charbinger\u201d to overcome the threat of Western sanctions, according to Sullivan.<\/p>\n

The inclusion of Argentina, which is not a massive economy in South America, may also have a lot to do with the country\u2019s openly-expressed desire to move its economy away from the US dollar by trading in local currency, a key issue among BRICS nations.<\/p>\n

\u201cPart of this (Argentina\u2019s inclusion) has to do with Argentina\u2019s keenness on de-dollarization,\u201d Sullivan said. \u201cThe Argentinian economy may be one where they are willing to try de-dollarization and willing to experiment in terms of their currency system and achieving bilateral trade in ways that are likely to appear as appealing to BRICS.\u201d<\/p>\n

BRICS convened as populous regional powers, but the bloc is now looking to gather trade partners across the globe to further its economic might and achieve financial initiatives, along with holding some sway in the energy markets, according to BRICS expert, Mihaela Papa.<\/p>\n

\u201cThe inclusion of these six nations is aimed at increasing trade opportunities and all of these states are interested in BRICS\u2019 financial initiatives such as engaging with its financial institutions and transitioning to trade in local currencies,\u201d Papa, a Senior Fellow at the Fletcher School, told Al Arabiya English.<\/p>\n

The Road Ahead<\/strong><\/p>\n

Following the expansion, BRICS now accounts for 36 percent of the global gross domestic product (GDP) and 47 percent of the world population, with 3.7 billion people residing in BRICS+.<\/p>\n

According to experts, with 11 countries in the bloc, the group holds significant sway in bargaining with organizations such as the G7 and the global West in general. Some scholars believe the inclusion of countries like Iran may push an anti-West agenda in the bloc, as countries like India and Brazil, who share cordial ties with the US, lean more heavily into the group that already has Russia and China and now Iran, who openly criticize the West\u2019s dominance in the world order.<\/p>\n

\u201cBRICS has explicitly rejected anti-American positioning and emphasized new development ideas. However, accepting Iran is likely to enhance the group\u2019s anti-American narratives and agendas, which have been gaining traction since Russia\u2019s invasion of Ukraine,\u201d Papa added.<\/p>\n

While no statements were made by BRICS leaders on a common currency \u2013 except by Brazilian President Luiz Inacio Lula da Silva, who said the group has established a \u201cworking group to study a reference currency\u201d \u2013 the bloc\u2019s expansion is a strong sign that BRICS may move towards conducting more trade in local currencies, according to Sullivan.<\/p>\n

\u201cLula talking about it (reference currency) at the beginning and end of the summit means there was real progress in sort of keying up the development of the BRICS currency, though there has been no big announcement yet on that,\u201d he said.<\/p>\n

The individual might of these countries is expected to make a significant impact in bolstering the economic development of the bloc, by forging strong bilateral ties and creating a more balanced economic world order.<\/p>\n

Go to Original – infobrics.org<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

19 Sep 2023 – Why these six countries? One of the prominent goals of BRICS is to enhance cross-border trade among member nations to boost the group economically and reduce the bloc\u2019s reliance on the US dollar.<\/p>\n","protected":false},"author":4,"featured_media":244578,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[180],"tags":[239],"class_list":["post-244577","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-brics","tag-brics"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/244577","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=244577"}],"version-history":[{"count":1,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/244577\/revisions"}],"predecessor-version":[{"id":244579,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/244577\/revisions\/244579"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media\/244578"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=244577"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=244577"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=244577"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}