### Summary
The BRICS countries, consisting of Brazil, Russia, India, China, and South Africa, are holding a summit in Johannesburg to challenge Western economic dominance. They aim to create a multipolar global order and are open to expansion.
### Facts
- The BRICS countries represent 23% of the world's GDP and 42% of the world's population.
- The group was formed in 2009 and meets annually to assert their position against the US and EU.
- The BRICS bloc is now open to expansion, with 23 applicants and numerous interested parties.
- The New Development Bank, an alternative to the World Bank and IMF, has invested $30 billion in infrastructure projects.
- Russia's President Putin, who is the target of an ICC arrest warrant, will attend the summit via video link.
- The BRICS countries aim to decrease their reliance on the US dollar and increase the use of their national currencies.
- They also plan to create their own international university rankings, challenging existing rankings that may exclude certain countries for political reasons.
BRICS seeks to expand its membership and become a champion of the "Global South," with over 40 countries expressing interest in joining the bloc to challenge Western dominance and address grievances related to abusive trade practices and neglect of poorer nations' development needs, among others. However, observers note that BRICS has a limited track record and may struggle to deliver on expectations.
The BRICS alliance could gain control of the majority of the world's oil and gas trade by including Saudi Arabia and the United Arab Emirates, which could lead to a shift away from the USD and the de-dollarization of the oil economy.
The Brics economic group, consisting of Brazil, Russia, India, China, and South Africa, is discussing the possibility of expanding its membership and promoting the use of local currencies for trade settlement, with aims to challenge the dominance of the US dollar, but analysts believe that the greenback is unlikely to lose its status as the international reserve currency.
The BRICS summit, which aims to establish a new world monetary order and give voice to underrepresented nations, is criticized for being a nebulous concept without concrete achievements and is primarily centered around China.
BRICS, comprised of Brazil, Russia, India, China, and South Africa, now represents almost a third of global GDP and is surpassing the economic influence of the G7, with over 40 nations expressing interest in joining.
The BRICS New Development Bank is receiving applications from 15 countries to join, as it aims to lessen its dependence on the US dollar and prioritize local currency lending.
The BRICS summit is aiming to reduce reliance on the U.S. Dollar, as the coalition confirms new members including UAE, Egypt, Ethiopia, Saudi Arabia, and Argentina, and discusses the possibility of a new payment system and currency backed by gold.
With major oil exporters joining BRICS, analysts suggest that the adoption of local currencies for trade among BRICS countries, rather than the US dollar, is becoming more natural, potentially reducing transaction costs and weakening the role of the petrodollar.
Egypt hopes that its inclusion in the BRICS bloc will help alleviate its shortage of foreign currency and attract new investment, although analysts suggest that it may take time before the benefits become evident.
The BRICS summit focused on increasing the use of local currencies for trade, but there were no discussions about a digital currency; however, three non-BRICS countries also announced plans to use local currencies instead of the dollar for cross-border trade.
BRICS is considering making local currencies the only accepted form of payment for oil and gas settlements, which could potentially shift global power from the West to the East.
South Africa is poised to expand its agricultural trade and globalize its economy as it enhances its position within the BRICS grouping, with the ZZ2 Farming Company using cutting edge technologies and tariff agreements to facilitate agricultural trade with other BRICS countries; the expansion of BRICS will create a powerful group of growth economies that will demand multilateral reforms, increase collaboration among growth economies, and enhance the use of regional currencies.
The BRICS nations are divided on the issue of de-dollarization, as statements from the bloc's leaders indicated, despite discussions about the creation of a common currency to rival the US dollar.
The BRICS expansion and their de-dollarization efforts have been met with a relatively calm response from the US, Germany, and the European Union, emphasizing the importance of countries choosing partnerships based on their national interests.
The BRICS alliance is considering the creation of a 'single unit account' as an alternative currency to the US dollar, in order to settle cross-border transactions without depending on a single currency or local currencies.
Creating a BRICS currency backed by gold is considered nonsensical by a former Bank of America strategist, as it would essentially be another gold derivative and would weaken individual currencies within the group.
The BRICS expansion, which includes countries like Saudi Arabia, the UAE, and Iran, has raised concerns in the U.S. and EU as it poses a threat to Western-dominated financial markets, while China's influence grows and the alliance aims for de-dollarization in global trade.
The BRICS bloc, including countries like India, China, and Russia, is slowly reducing its dependency on the US dollar and using their local currencies for trade, which could potentially weaken the US dollar's position as the dominant global currency.
The BRICS coalition, along with new members, aims to reduce the dominance of the US dollar by using their own currencies for oil trade, posing potential risks to the US's global leadership and economy.
The American banking, trade, forex, tourism, and other sectors could be severely impacted if BRICS countries stop using the U.S. dollar for trade, leading to potential financial catastrophe and hyperinflation.
The BRICS New Development Bank has announced a 3-year de-dollarization plan to increase local currency transactions and reduce reliance on the US dollar for developing country investments, aligning with the alliance's strategy to move away from the dollar. Additionally, the bank's expansion may greatly affect its lending model and facilitate the alignment with the alliance's strategy.
BRICS (Brazil, Russia, India, China, South Africa) is aiming to challenge the global reserve status of the US dollar by exerting control over a significant portion of the oil sector, starting with Russia's Gazprom Neft announcing that it will no longer rely on the US dollar for trade and is open to accepting local currencies.
BRICS countries, including China, Brazil, and Saudi Arabia, sold a total of $17.4 billion in U.S. treasuries in September 2023 to prevent the dollar from rising against local currencies and weakening commodities, such as gold and oil.
The BRICS bank, known as the New Development Bank (NDB), has announced a 3-year plan to end reliance on the US dollar, leading to trade settlements in local currencies and potentially causing a shift in global financial power from the West to the East.
BRICS has surpassed the G7 in terms of purchasing power parity, contributing 31.5% to global GDP compared to the G7's 30.7%, and if BRICS succeeds in ditching the US dollar for global trade, the gap could widen further, potentially tilting financial power to the East.
BRICS' expansion and the dominance of the oil market could lead to the US and Europe needing local currencies to buy oil, aligning with the bloc's de-dollarization agenda.
The induction of new countries, particularly oil-exporting nations, into the BRICS alliance and their potential demand for the US and Europe to pay for oil in local currencies could decrease the demand for the US dollar and lead to its depreciation, impacting the purchasing power of the dollar and rewriting trade policies. However, it is unlikely that BRICS would be able to successfully demand this, as it could result in the loss of bilateral trade deals with the West and negatively impact their GDP and economy.
The BRICS Bloc has introduced BRICS Pay, a new financial settlement platform that aims to simplify payments and encourage trade between member countries by utilizing their respective national currencies, with the system already being implemented by Standard Chartered Bank and the State Bank of India.
The possibility of the BRICS bloc launching its own currency at the 2024 summit has been raised, with Russian economist Sergey Glazyev stating that the currency is almost ready and awaiting political consent from the BRICS countries.
Russian President Vladimir Putin claims that the BRICS alliance, of which he is a member, is surpassing the G7 bloc in terms of financial strength and challenging their dominance in the global financial system, and is looking for new ways to reduce reliance on the US dollar.
The BRICS currency, which aims to replace the US dollar as the world's reserve currency, is almost ready and awaiting political consent from all BRICS countries before its release.
