Multinational summits have become commonplace, but the recent annual meeting of BRICS nations drew significant attention. In the U.S. and other Western countries, the assessments we saw from business and mainstream publications and foreign policy think tanks mostly ranged from dismissive to critical, or even mocking. They largely missed the mark, in our view. <\/p>\n
There continues to be a lot of misunderstanding about what BRICS is (an association of countries that want a bigger say in global affairs, as well as deeper trade and strategic ties among themselves), and especially about what BRICS is not<\/strong> (a formal bloc like the G7, NATO, or AUKUS that is directly confronting rival nations). <\/p>\n There is also confusion about what BRICS is aiming for: the reform of international institutions like the UN Security Council, the International Monetary Fund, and the World Bank, all of which have been dominated by Western developed countries since the end of World War II and the establishment of the Bretton Woods monetary system. <\/p>\n And there\u2019s not a lot of context about what all of this has to do with the geopolitical and geo-economic shifts that are taking place\u2014changes that are the most consequential since the Cold War ended, in our assessment. <\/p>\n The already eclectic group of BRICS countries is becoming even more so. The five BRICS members\u2014the acronym stands for Brazil, Russia, India, China, and South Africa\u2014have extended membership invitations to six others: Saudi Arabia, the United Arab Emirates, Iran, Egypt, Ethiopia, and Argentina. <\/p>\n The addition of four Middle Eastern countries to the BRICS club may underscore that U.S. influence in the region is waning. Countries that once viewed the U.S. as their principal ally, such as Saudi Arabia and the UAE, no longer see the world through this prism, according to Middle East expert Helima Croft, who is RBC Capital Markets, LLC\u2019s Global Head of Commodity Strategy. Rather, these countries view the U.S. as one of a handful of important partners that they will work with. <\/p>\n All four of the Middle Eastern countries already have active, constructive relations with China, Russia, and India that have been strengthening for years. <\/p>\n BRICS membership is an effective way for Saudi Arabia, the UAE, and Egypt to sit on multiple chairs, rather than just being seated with the U.S. and other Western countries, in our view. It\u2019s not that the invitees are casting aside their relationships with the U.S. and the West; rather, they regard their decisions to join BRICS as formalizing their already strong and deepening ties with other powers. <\/p>\n Their interest in BRICS is also a subtle (or maybe not-so-subtle) message to Western powers that unilateral economic sanctions, asset freezes, and asset confiscations\u2014like the ones imposed on Russia following its military intervention in Ukraine\u2014are harmful to the global economy and supply chain system. <\/p>\n All BRICS countries oppose such unilateral measures and are unwilling to impose them on each other. The six countries that received invitations have agreed to this, according to Russia\u2019s Ministry of Foreign Affairs. It\u2019s interesting that this is one of the few criteria for BRICS membership. <\/p>\n The Middle Eastern and African countries seem all but certain to accept BRICS membership, in our view, because it affords them additional economic and trade opportunities, along with geopolitical and strategic leverage. New memberships will become effective on Jan. 1, 2024. <\/p>\n Argentina is more of a wild card, with its decision dependent on the outcome of its forthcoming presidential election in October; two of the leading candidates have indicated they do not want to join BRICS. <\/p>\n Over the course of the next year, BRICS countries have stated that they will seek to develop mechanisms to expand trade in local currencies and to work around the Western-based SWIFT electronics payments system. The association\u2019s New Development Bank will increase its efforts to provide and raise capital for infrastructure projects. <\/p>\n In 2024, we expect the expanded BRICS group to offer additional countries full memberships and\/or to develop a partnership framework, perhaps structured along the lines of the like-minded Shanghai Cooperation Organisation (SCO). <\/p>\nJoin the club<\/h2>\n
BRICS countries represent three of the top five and four of the top 10 largest economies <\/h3>\n
Gross Domestic Product in 2022 on a purchasing power parity basis <\/h4>\n
\n\n
\n \nRanking<\/th>\n Economy <\/th>\n GDP (millions of international dollars)* <\/th>\n<\/tr>\n<\/thead>\n \n 1<\/td>\n China<\/td>\n 30,327,320<\/td>\n<\/tr>\n \n 2<\/td>\n United States<\/td>\n 25,462,700<\/td>\n<\/tr>\n \n 3<\/td>\n India<\/td>\n 11,874,583<\/td>\n<\/tr>\n \n 4<\/td>\n Japan<\/td>\n 5,702,287<\/td>\n<\/tr>\n \n 5<\/td>\n Russia<\/td>\n 5,326,855<\/td>\n<\/tr>\n \n 6<\/td>\n Germany<\/td>\n 5,309,606<\/td>\n<\/tr>\n \n 7<\/td>\n Indonesia<\/td>\n 4,036,901<\/td>\n<\/tr>\n \n 8<\/td>\n Brazil<\/td>\n 3,837,261<\/td>\n<\/tr>\n \n 9<\/td>\n France<\/td>\n 3,769,924<\/td>\n<\/tr>\n \n 10<\/td>\n United Kingdom<\/td>\n 3,656,809<\/td>\n<\/tr>\n \n 11<\/td>\n T\u00fcrkiye<\/td>\n 3,180,984<\/td>\n<\/tr>\n \n 12<\/td>\n Italy<\/td>\n 3,052,609<\/td>\n<\/tr>\n \n 13<\/td>\n Mexico<\/td>\n 2,742,903<\/td>\n<\/tr>\n \n 14<\/td>\n South Korea<\/td>\n 2,585,011<\/td>\n<\/tr>\n \n 15<\/td>\n Canada<\/td>\n 2,273,489<\/td>\n<\/tr>\n \n 16<\/td>\n Spain<\/td>\n 2,181,968<\/td>\n<\/tr>\n \n 17<\/td>\n Saudi Arabia<\/td>\n 2,150,487<\/td>\n<\/tr>\n \n 18<\/td>\n Egypt<\/td>\n 1,674,951<\/td>\n<\/tr>\n \n 19<\/td>\n Australia<\/td>\n 1,626,940<\/td>\n<\/tr>\n \n 20<\/td>\n Poland<\/td>\n 1,625,236<\/td>\n<\/tr>\n \n 21<\/td>\n Iran<\/td>\n 1,600,556<\/td>\n<\/tr>\n \n 22<\/td>\n Pakistan<\/td>\n 1,518,043<\/td>\n<\/tr>\n \n 23<\/td>\n Thailand<\/td>\n 1,482,098<\/td>\n<\/tr>\n \n 24<\/td>\n Vietnam<\/td>\n 1,321,256<\/td>\n<\/tr>\n \n 25<\/td>\n Nigeria<\/td>\n 1,280,716<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n \n