In the past several years the BRICS have greatly increased their prominence in the global economy as a rising number of developing countries are applying for membership in the block. Over and above the discussions on BRICS expansion there is also the possibility of BRICS transforming the global financial system with the creation of a BRICS common currency. This enthusiasm and spotlight are in stark contrast to earlier pronouncements of the lack of luster in the grouping coming from observers both in the developed and developing world. So what is the reason for such a drastic turnaround in perception in a matter of just several years? Could it be that the BRICS have finally opened up the “possibility set” for the world economy that has gone from one crisis to another without a credible vision of alternatives?
In fact, it may be precisely the emergence of such alternatives in the past several years that engendered the greatest interest with respect to the BRICS block – most notably the possibility of creating a new common BRICS currency. And while all the discussions about a speedy displacement of the US dollar from its global throne by the BRICS currency are unrealistic, the very possibility of an alternative instrument that could be used internationally presents an important signal to the global community that alternatives are possible. Alongside with the creation of new institutions, such as NDB, the resulting paradigm shift is that of greater divergence in economic development rather than convergence towards one model, one set of institutions and payment system/currency.
The second factor behind the rising prominence of BRICS is the block’s greater openness – the BRICS+ initiative re-launched by China in 2022 has generated a massive response throughout the Global South. The block of developed economies will have difficulties in emulating the degree of inclusivity demonstrated by the BRICS+ format. Furthermore, the openness and inclusiveness of BRICS is multifaceted – it concerns not only the formal membership and the various formats in BRICS and BRICS+, but also the acceptance of various developmental models, political/economic systems and modernization paths. In this respect, BRICS openness and inclusiveness are closely related to the “divergence paradigm” and the emergence of alternatives brought about by the block into the world economy.
Another aspect of this greater inclusiveness and rising appeal of BRICS throughout the Global South is the sense of “shared prosperity” that is relevant not only for countries, but also wide strata of the population in the developing world. For countries BRICS and BRICS+ may provide a more open and equitable platform for catch-up growth. For the population it is about the widening of the ranks of the “middle class” of the Global South and taking its headcount in the developing world from millions to billions. The “demonstration effect” of some of the most successful BRICS countries such as China in fighting poverty and widening the ranks of the middle class may also be an important factor in the rising appeal of the BRICS on the world stage. And what about the billions of investors, entrepreneurs and inventors from the Global South emerging on the back of a new paradigm that allows the developing economies to reach their potential? Would that not be the greatest possible contribution to global welfare and global growth?
In some respects, the BRICS project may be perceived as a start-up of the Global South – with great uncertainty and doubts that faced the innovations introduced by BRICS into the global economy. It is also a certain vision of the future that has tremendous innovative power to shape new global governance for the new generation and by the new generation of global citizens. This is because there is an important generational element in the BRICS project that also raises its appeal in the developing world. The median age in almost all developed economies is well above the global benchmark. In the case of BRICS, South Africa (28) and India (29) are lower than the global level (around 30-31 years) and in Brazil (33.5) it is close to the global average and notably below levels observed in advanced economies. In the case of China the growth in the median age over the past several decades still leaves it notably lower than in most developed economies. This generational factor is taken to another level within the framework of BRICS+ that brings on board Africa (median age is less than 20 years) and Latin America (close to 30-31 years) as regional partners of an extended alliance. A power shift in favour of the younger generation of the Global South will allow for a “shift in the global mindset” away from the fixation on the past and more towards the future.
In the end, BRICS is not just an agent of change, it is increasingly seen by the young generation of the Global South as a key pillar of a more equitable and sustainable future. In my conversations with young South Africans at the BRICS Academic Forum earlier this year, one of the Forum participants in describing her enthusiasm about BRICS noted: “we here think this is the future”. A vision of a brighter future by the young generation of our global community is what this world needs after all the disillusionments of the past several decades.
Courtesy: Modern Diplomacy
