The BRICS Bloc: Forging a New Economic and Political Order?

A new world order may be emerging, not with a bang, but with the steady construction of a new bloc of nations. The BRICS group, once a catchy acronym for promising emerging markets, has evolved into a formal intergovernmental organization that is actively forging a new economic and political reality. This bloc is challenging the long-standing dominance of the G7 and Western-led institutions like the International Monetary Fund (IMF) and the World Bank.

The Genesis and Evolution of BRICS

The term "BRIC" was first coined in 2001 by Goldman Sachs economist Jim O'Neill to highlight the economic potential of Brazil, Russia, India, and China. However, it was the political will of these nations that transformed an investment thesis into a geopolitical reality. The first formal summit of BRIC leaders took place in 2009, driven by a shared desire to increase their influence in global financial institutions and create a more multipolar world order.

In 2010, the bloc expanded to include South Africa, adding an "S" to the acronym and marking a significant step towards representing the Global South. This move signaled a shift in focus from purely economic potential to a broader agenda of geopolitical coordination and South-South cooperation.

A Wave of Expansion

The most dramatic transformation of the bloc to date occurred in 2023 when the BRICS leaders invited six more countries to join: Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates. While Argentina ultimately declined the invitation, the other five nations officially became members in January 2024, with Indonesia joining in early 2025. This expansion, which has led to the informal use of the term "BRICS+," has significantly increased the bloc's global footprint. With its new members, the BRICS now represents approximately 45% of the world's population and over 35% of the global GDP in terms of purchasing power parity.

The expansion has been a key objective for China and Russia, who see it as a way to build a geopolitical counterweight to the United States and the West. However, other members like India see the inclusion of countries with strong ties to the West, such as the UAE and Saudi Arabia, as a way to maintain a more balanced approach.

The door to BRICS remains open, with a new category of "partner countries" being created in 2024 to facilitate further integration. This new tier includes countries like Algeria, Belarus, Bolivia, Cuba, Kazakhstan, Malaysia, Nigeria, Thailand, Turkey, Uganda, Uzbekistan, and Vietnam, who can now engage with and benefit from BRICS initiatives.

The Economic Vision: De-dollarization and a New Financial Architecture

A cornerstone of the BRICS agenda is the push for de-dollarization, a process of reducing the reliance on the U.S. dollar in international trade and finance. This desire stems from both economic pragmatism and geopolitical strategy. The dominance of the dollar gives the United States significant leverage to impose financial sanctions and influence global monetary policy, a vulnerability that countries like Russia and China are keen to mitigate.

The BRICS nations have been actively exploring ways to achieve this, including:

Promoting trade in local currencies: The members are increasingly conducting bilateral trade using their own currencies, bypassing the dollar altogether.
Developing alternative payment systems: China has developed the Cross-Border Interbank Payment System (CIPS) as an alternative to the Western-dominated SWIFT system, and Russia has its own System for Transfer of Financial Messages (SPFS). The BRICS are also working on a decentralized payment messaging system called BRICS Pay.
Establishing new financial institutions: The creation of the New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA) are two of the most significant achievements of the BRICS.

The New Development Bank (NDB)

Established in 2015, the NDB aims to provide financing for infrastructure and sustainable development projects in BRICS and other emerging economies. It offers an alternative to the World Bank and IMF, where developing countries have long felt underrepresented. The NDB has an authorized capital of $100 billion and provides loans in various currencies, further supporting the de-dollarization agenda. By 2022, the NDB had invested over $30 billion in projects related to renewable energy, transportation, and other key sectors.

The Contingent Reserve Arrangement (CRA)

The CRA is a framework for providing mutual financial support to member countries facing short-term balance of payments pressures. It acts as a collective safety net, reducing the need for members to turn to the IMF for assistance. The CRA has a total committed resource of $100 billion, with contributions from all founding members. This arrangement is seen as a way to enhance financial stability and protect against global liquidity crises.

The Political Agenda: A Multipolar World Order

Beyond economics, the BRICS bloc has clear political ambitions. It seeks to create a more "equitable and just" world, with a greater role for developing countries in global governance. Key political objectives include:

Reforming international institutions: The BRICS have consistently called for comprehensive reform of the United Nations, including the Security Council, to give developing nations a stronger voice. They also advocate for reforms at the IMF and World Bank to better reflect the changing global economic landscape.
Promoting a multipolar world: The bloc actively challenges the idea of a unipolar world dominated by the United States. By strengthening their own political and security cooperation, the BRICS aim to create a more balanced international system.
Countering Western influence: For some members, particularly China and Russia, the BRICS is a platform to counter what they see as Western hegemony. This includes pushing back against unilateral sanctions and the use of economic coercion.

Challenges and Criticisms: A House Divided?

Despite its ambitious goals, the BRICS bloc faces a number of significant challenges and criticisms.

Internal divisions: The member countries have diverse political systems, economic models, and national interests, which can sometimes lead to a lack of coherence. For example, the border dispute between China and India remains a point of tension.
China's dominance: China's economic and political weight within the bloc is a source of concern for some members, who fear that their own influence could be diluted.
Lack of a unified agenda: Critics argue that the BRICS is more united by what it is against—Western dominance—than what it is for. Forging a coherent, positive agenda for global reform is a major challenge.
The de-dollarization challenge: While the BRICS are committed to de-dollarization, the U.S. dollar's dominance in the global financial system is deeply entrenched, and creating a viable alternative will be a long and difficult process.

The Future of BRICS: A New Order on the Horizon?

The expansion of the BRICS has undoubtedly increased its potential to become a major geopolitical and geoeconomic force. The bloc's focus on de-dollarization, its creation of alternative financial institutions, and its push for a more multipolar world order are all signs of a significant shift in the global landscape.

However, the future of the BRICS will depend on its ability to overcome its internal divisions and forge a truly unified vision. The bloc's success will also be shaped by the reactions of the West. Some analysts believe that a more confrontational approach from the United States could actually accelerate the BRICS' efforts to create an alternative to the Western-led order.

Whether the BRICS will ultimately succeed in forging a new economic and political order remains to be seen. But one thing is clear: the bloc has already managed to change the conversation about global governance and has given a powerful voice to the nations of the Global South. The world is watching to see what this rising power will do next.