Five things we found out at this year’s BRICS summit

The yearly BRICS summit wrapped up in Russia yesterday (Thursday), ninja-starring dozens of new announcements out into the world before dropping a 32-page Joint Declaration that probably could’ve just been an email.

But first, some context. Starting out as a Goldman Sachs acronym for emerging markets with promise back in 2001, the four originals (Brazil, Russia, India, and China) actually started meeting together in 2009 before South Africa joined in 2010, not unlike how Danny Devito joined It’s Always Sunny in Philadelphia in season two.

It all started out as an investment forum, but quickly evolved into more of a geopolitical group claiming to represent the Global South. And as we’ll see below, it continues to evolve into something else.

Along the way, it’s picked up a few new members, including Iran, Egypt, Ethiopia, and the UAE, while another 10 or so are still in the hazing process. And BRICS members now account for about 35% of the world economy (half of that is China) and 45% of the world’s population (three quarters of that is China + India).

Anyway, hosting duties fell to Russia’s Vladimir Putin this year, after he had to dial into last year’s summit due to the ICC’s warrant out for his arrest. So let’s get you five of the summit’s biggest revelations.

1. Are India and China friends again?

‘Friends’ is probably too strong of a word, but maybe frenemies? That’s because India’s Narendra Modi and China’s Xi Jinping met on the summit sidelines for the first time in over five years. And that’s just days after Beijing and Delhi announced a deal on patrolling their disputed border, potentially thawing years of frostiness after dozens of their soldiers died in a brutal 2020 standoff involving sticks and clubs. 

And of course, any improvement in ties is worth an approving nod, but the sheer size of these two players, the complexity of their ties, and the contrast between the futures they want to see, all means that realistically, this relationship is never going to be easy.

2. A new payment system?

One of the more intriguing (though not surprising) ideas getting some airtime at this summit was a Russia-led proposal to build a BRICS payment messaging system to bypass the West’s dominant SWIFT platform (where Russian banks are banned). 

That’s not surprising because the Russians have been hunting for options to settle their trades ever since they became the world’s most sanctioned nation — they don’t want Indian rupees, for example, but Indian buyers don’t want to risk US sanctions by paying in US dollars, either.

Other BRICS members (like China) will be sympathetic to the need to future-proof against Western sanctions, such as in the event of a war over Taiwan. And history will judge whether the West’s use of SWIFT to isolate Russia has undermined SWIFT itself.

But making this proposed new ‘BRICS bridge’ a reality will face some big challenges: for instance, the currencies of the two biggest BRICS economies (China and India) aren’t even fully convertible. Oh, and speaking of currencies — last year, BRICS leaders also suggested developing a common currency, an idea which has since gone nowhere.

3. A BRICS grain exchange?

Another Russia-led proposal, the idea here is for BRICS countries to barter their respective agricultural commodities directly, without pesky Western sanctions attached to the US dollar. An exchange like this, Russia argues, could then be expanded to other commodities which Russia conveniently also sells, like oil, gas, and metals.

Interestingly, there are already reports of Russia resorting to this — eg, one firm just settled a trade with cash-strapped Pakistan using 20,000 tonnes of chickpeas!

But signatories to the BRICS declaration merely said they “welcomed” Russia’s proposal — we’ve negotiated many texts and can confirm this is the equivalent of an awkward nod.

Still, the mere suggestion hints at the dire situation facing the world’s largest exporter of wheat, with Putin now reportedly exporting high volumes for low prices while asking buyers to forgo intermediaries.

4. A flex from China?

During his address, President Xi Jinping announced China will establish several new BRICS bodies, including a deep-sea research centre, a centre dedicated to ‘special economic zones’ in BRICS countries, a digital cooperation centre, and beyond.

There’s not a lot of detail around the proposals themselves, but the intended message seems clear: i) don’t listen to the haters, BRICS is doing real, tangible stuff; ii) if you need help with anything, call China (we’ll have a centre for that), and that’s because iii) China is in the BRICS driver’s seat.

5. A divisive appearance by the UN chief

And finally, UN Secretary-General Antonio Guterres has drawn fire for attending this BRICS summit. Critics say the guy charged with helping the world avoid “the scourge of war” shouldn’t be visiting – let alone shaking hands with – the guy now wanted by the International Criminal Court for kidnapping children while invading his neighbour. Particularly after declining to attend Ukraine’s peace summit in Switzerland this June.

His defenders note he attended last year’s summit too (though not in Russia, and not with Putin), and that the UN chief needs to deal with everyone to fulfil his mandate. On that last point, he reportedly even told Putin his invasion of Ukraine was illegal. But Putin’s smile suggests he might’ve heard something else: you can invade a neighbour and still get a UN photo opp.

INTRIGUE’S TAKE

There’s an unwritten rule in Hollywood that if someone tells you there’s a problem with your script, they’re probably right. But if they then tell you how to fix it, they’re probably wrong.

The existence, messaging, and evolution of the BRICS group is all evidence of a problem with the international system: it still doesn’t make enough space for the Global South. But does BRICS also hold the solution? Even some BRICS leaders themselves seem doubtful — one of the voices consistently tapping the group’s brakes is India’s Modi, whose summit remarks were pretty direct in cautioning BRICS against “trying to replace global institutions” or giving off “divisive” vibes.

And with that kind of tension between the group’s two key members (China hitting the gas while India taps the brakes), it’s hard to see BRICS making meaningful progress. In the meantime, it offers a low-cost way for new members to signal their autonomy and get more access to world leaders. Though of course, each new member will only further complicate efforts to agree. And there are already disputes over who to even let in (Brazil just vetoed neighbouring Venezuela’s membership bid this week).

Also worth noting: 

• Some 36 states attended this year’s BRICS summit (including various BRICS partners).
• Interestingly, the crown prince of Saudi Arabia, which seems to be hovering somewhere in between BRICS membership and non-membership, skipped the summit in favour of a meeting with US Secretary of State Antony Blinken.