If there’s one word that can accurately describe the global financial system, it is the word unfair. The current global financial system has been and is still unfair to developing countries that have no power and no choice but to live by the rules set by the powers that be. It is unfair because the system is biased towards countries of the West who for example need to pay only one percent interest rate when they borrow form the World Bank or IMF, meanwhile, African countries have to pay about 5, 8, or even 10 per cent interest rate when they need to borrow because they are apparently riskier. This unfair financial system has contributed to the current developmental status of developing countries because instead of focusing on development, these countries spend a huge bulk of their revenue on financing debt. The countries that control this unfair system, especially the USA, have used it time and time again to push their ideals across the world, and when it is resisted, it has been used to punish countries, like in the case of Russia. All these have led to a clamour for a change in the global order and the answer to this seems to be BRICS.

Although it was formed in 2009, BRICS started gaining prominence after the COVID-19 pandemic. Today, this bloc, initially made up of five-member countries, has grown to include six countries making it eleven in total. In addition, according to South Africa’s Foreign Minister Naledi Pandor, 34 countries have expressed interest to join this bloc. Now, why is BRICS important? Why do so many countries want to join this bloc? Why is the West scared about BRICS? And what does it mean for Africa? To answer all this, we first need to understand what BRICS is all about.

After World War 2, the United States emerged as the undisputed hegemony both in military and economic power, which allowed it to create a world order that reflected its values and interests. According to John Ikenberry, the liberal economic international order (LEIO) is organized around “open markets, multilateral institutions, cooperative security, alliance partnership, democratic solidarity and United States hegemonic leadership. Organizations such as the United Nations, NATO, WTO, IMF, and the World Bank have been utilized to spread these values and promote economic integration. One thing that you should understand is that this current world order only serves the interest of those countries on top, namely the G7. This is why in the last few decades there has been a shift in global economic power and along with it a desire to create an alternative international system. This is where BRICS comes in. BRICS, which is an acronym for its founding members, Brazil, Russia, India, China, and South Africa, is an organization that was formed in 2009 to challenge the existing global order. It’s main goal is to create a viable alternative to the present international system, which would include setting up economic institutions, creating a new reserve currency, and decreasing their dependency on the west.

One of the major sources of dissatisfaction of the BRICS bloc is their underrepresentation in critical organizations. For example, while Russia and China possess vetoing powers, not a single country in Africa or Latin America is a permanent Security Council member. In addition, the United States has the highest influence over the IMF and the World Bank, occupying a third of the voting power for both institutions. This means that the United States can influence the World Bank not to release funds to a particular country. A good example is how the World Bank has suspended developmental assistance to Uganda because the country passed anti-gay laws. Definitely, the World Bank would not make that kind of decision without the approval of the United States. How can one single country have that much power?

Another bone of contention between members of BRICS and the creator of the current global system is the hypocrisy of the United States which has manifested over and over again through continuous violations of international law and their use of violence. In 2003, the Bush administration invaded Iraq. However, that invasion was a violation of the basic tenets of the Security Council, which set a precedent that state sovereignty was only applicable to states that consented to the LEIO. In the 1980s, the United States ignored the verdict of the International Court of Justice to pay reparations to Nicaragua for illegally mining its harbors. These are however just a few examples of how the United States has violated international laws and committed crimes against humanity all in the name of protecting their interests, yet the United States has never been sanctioned for it and neither has it paid for it.

In addition, to all these, the United States has assumed the head of the global order and sanctioned countries that do not follow its ideals and principles, and the reason why the sanctions are effective is because the dollar is the reserve currency of the world. A lot of countries including China and Russia have suffered as a result of these sanctions. So, it’s no wonder that dethroning the dollar is a top priority for BRICS. In one way or another, each of these countries has suffered under the hegemony of the United States and countries of the West, and hence the reason for the creation of BRICS. Developing countries are currently clamoring to join this alternative to the current global system because they want to stay ahead of the changing financial dynamics. If you observe how the currencies of developing countries especially in Africa are performing against the dollar, you would understand why there is a need to shift away from the dollar and BRICS is willing to initiate this global shift removing the spotlight from the US dollar and keeping the focus on local currencies. The paradigm shift could uproot the US dollar’s global hegemony and challenge the traditional financial order controlled by the West.

Now, following the conclusion of the 2023 BRICS meeting held in Johannesburg, South Africa, the bloc announced that beginning from January 1st, 2024, it would undertake a historic expansion and admit five new members including Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates. This means it can no longer be called just BRICS. Instead, it’s now called BRICS+. The current expansion of BRICS means a whole lot. With the addition of these new member states, BRICS currently represents approximately 42% of the world’s population and 36% of the global GDP. From a trading perspective the expanded group accounts for more than 43% of global oil production, doubling its capacity, and enhancing its geostrategic reach into the Middle East. Further still, the expanded group now accounts for 25% of global exports, while the original four BRIC members account for and control 72.5% of global reserves of rare earth minerals, with China alone producing 85% of all globally refined earths in 2020.

However, BRICS do not limit their ambitions to an economic agenda but rather seek to leverage their collective economic weight to pursue a wider political ambition. Notably in order to reduce dependence on the World Bank and International Monetary Fund -institutions that are historically led by Europeans and Americans and are often criticized for their lack of transparency and draconian structural adjustment programs – the BRICS established the New Development Bank in 2015 to mobilize resources for infrastructure and sustainable development projects. With an initial authorized capital of $100 billion, by 2022 the bank has assigned $32.8 billion to 96 approved projects, helping to build and upgrade 15,700 km of roads, 850 bridges, and 260 km of rail transit networks.

What all this means ultimately is that the expansion of BRICS has led to the enlargement of its economic power and geo-strategic reach and since more countries are expressing interest in joining, there is a possibility that BRICS would grow even more. So, what does this mean for Africa? The inclusion of Egypt and Ethiopia into the BRICS alliance has firmly put the African continent front and center with economic benefits widely seen to be accruing to the continent over time. 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.

While BRICS is seen by some as hope, some critics have said that it is unlikely that BRICS will be able to challenge the current system because the organization is riddled with political rivalries and economic disparities, giving the example of China and India which have ongoing territorial disputes in the Himalayan region. China and Russia also have disputes. Egypt and Ethiopia are also not left out. According to these critics, the dispute between these nations may result in a situation whereby BRICS is not able to achieve the goal for which it was established. While this may be true, one thing is all these nations came together because they desired to achieve a common goal which is to change the current global order. So, it’s more likely that they would put aside their differences and work together to achieve this goal. Regardless, BRICS is here to stay and the coming years will determine how everything will all play out.

What are your thoughts? Let us know in the comments section below. Don’t forget to like, subscribe and share this video.