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BRICS: Longing for a Common Currency and Successful Expansion



Brazil, Russia, India, China, and South Africa are the members of the BRICS group, which has long been heralded as a potential global powerhouse with the ability to challenge the hegemony of the Western world order.


The recent last-minute obstacles encountered during BRICS expansion discussions in South Africa, however, highlight the ongoing conflicts among member nations and demonstrate why it is only wishful thinking to believe that the group will ever successfully expand, much less create a single currency to challenge the dominance of the US dollar.


The ongoing discussion about the bloc's expansion, which was the focal point of the most recent summit in Johannesburg, underscores the inherent difficulties in reaching agreement among nations with such dissimilar economies.


At the most recent BRICS summit in Johannesburg, the ongoing discussion about the bloc's expansion captured the attention of attendees. This debate brought attention to the inherent difficulties in forging agreement among nations with drastically dissimilar economies, foreign policy objectives, and levels of interaction with the West. The intricacies of how much and how rapidly this expansion should occur have strained relations between the BRICS leaders, despite their public statements to the contrary.


The challenges of reaching unanimity are made more difficult by the consensus decision-making mechanism of the BRICS, which gives each member a de facto veto. Heavyweight in the group and advocate for an expanded BRICS, China has constantly worked to promote a multipolar world order to counteract Western dominance. The original goal of the bloc and individual national interests are at odds with other members' efforts to forge stronger ties with the West, such as Brazil and India.


Significant barriers to expansion are posed by the pronounced economic and geopolitical differences. While Brazilian President Luiz Inacio Lula da Silva rejected the notion that the BRICS should compete with the US and other developed economies, Chinese President Xi Jinping advocated for unity in the face of global unrest. These opposing viewpoints represent the underlying disparities in economic strength and diplomatic priorities, rendering the formation of a united front challenging.


A further example of how internal conflicts can impede development is the recent announcement of revised admission standards by Indian Prime Minister Narendra Modi at the eleventh hour. The suggested standards, such as the demand that a country not be the focus of international sanctions and the necessity for a minimum per capita GDP, reflect the divergent interests and goals of the member nations, which causes additional delays and uncertainty.


Only 22 nations have formally sought to join BRICS, despite the fact that over 40 nations have indicated interest in doing so, highlighting the lack of consensus within the group. These contenders come from a wide variety of countries and are driven by the desire to level the uneven international playing field. However, the discrepancies and conflicts among current members raise questions about the bloc's capacity to successfully incorporate new members and establish a coherent vision.


Given these divisions, the idea of a single currency challenging the US dollar's hegemony inside the BRICS group seems even less likely. High levels of economic convergence, political alignment, and mutual confidence are prerequisites for the establishment of a shared currency, and the BRICS countries sorely lack these elements.


The difficulties in coordinating fiscal policies across EU member states and the troubles of the Eurozone serve as illustrations of the enormous obstacles in introducing a single currency among nations with various economic/political agendas and institutions.

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