Stephan Ossenkopp, researcher, Schiller Institute
The 16th BRICS Summit in the Russian city of Kazan represents a historic milestone. With more than 200 events in the run-up to the summit, Russia as host has paved the way for the new BRICS leaders to spearhead the creation of a multipolar, equitable world order. The four new members – Iran, the United Arab Emirates, Egypt and Ethiopia – come from the strategic land bridge between Asia, the Arabian Peninsula and Africa. Saudi Arabia will also join. They all contribute significant potential in terms of energy and other resources. Economic growth has shifted even more towards the BRICS countries. At a meeting of BRICS finance ministers a few days ago, Russian Finance Minister Anton Siluanov said that the BRICS countries’ annual economic growth rate of 4.4 per cent was well above the world average of 3.2 per cent, while the G7 was lagging far behind at 1.7 per cent.
At least 30 other states are expected to join and participate in some form of BRICS activities. Countries such as Belarus, Cuba, Malaysia, Azerbaijan and many others have already applied for membership. Even Turkish President Recep Tayyip Erdogan will attend the summit, even though Turkey is a NATO member and has close trade relations with the European Union. Interest is high for a number of reasons. The US, and increasingly the EU, is widely perceived as a country whose economic, financial and political systems have failed. It is unable to cope with the speculative excesses of Wall Street and can no longer control its own public debt. It also risks a direct confrontation with nuclear power Russia and supports Israel’s brutal actions in the Middle East. It is therefore clear to the majority of the world community that BRICS is the rising star of a new world order, while parts of the West are trying to fight it with all the means at their disposal.
These means include sanctions, trade wars and decoupling. It is in this area that the BRICS will discuss a package of solutions at the summit, which should ultimately lead to the creation of a new financial system. A BRICS expert group, as well as BRICS finance ministers and central bank governors, have already put forward proposals. The first goal is to create a cross-border payment system that bypasses the dollar and is faster and cheaper than the Western-dominated Swift system. Russian President Vladimir Putin has made the creation of such a payment system a top priority. Economists such as Jeffrey Sachs, Paulo Batista and Sergei Glazyev have gone a step further. They are calling for the creation of a digital clearing currency for intra-BRICS trade.
This would allow all BRICS countries to continue using their national currencies, but still be able to settle international accounts. Experts are convinced that the Western financial system is unreformable. The reputation of the dollar as a reserve currency has deteriorated. Institutions such as the World Bank and the International Monetary Fund have degenerated into instruments for maintaining American hegemony. That is why the BRICS economists are calling for the creation of a BRICS reserve currency. Even if the host, President Putin, wants to proceed more cautiously and gradually in this area, the expectations of the developing countries, which have been plagued by sanctions and the neo-colonial methods of the Western-dominated system, are very high that the BRICS will create a new, fair and decentralised financial system. At the same time, the Russian president has announced that the BRICS-owned New Development Bank (NDB) will be expanded into a new multilateral institution. The share of local currencies will increase and the dollar will be increasingly marginalised. At the same time, more loans and private investment will be mobilised for large technology and infrastructure projects in the global south.
This year’s BRICS Summit can and must give voice to the global majority. The world is undergoing such gigantic tectonic shifts that the role of the US, but also that of the European colonial powers of the last five centuries, is dwindling due to their own arrogance. The policy of this hegemon towards the countries of the southern hemisphere, but also towards Russia, China, Iran, the Middle East, etc., has proved intolerable. The majority of the world’s population does not want to be dragged back into the straitjacket of a cold or even hot war, in which they will once again be the victims and bear the massive damage.
If the eagerly awaited BRICS summit can find a way to open the door to all these countries, to include and integrate them, then the shift from the transatlantic to the Asia-Pacific, with a non-aligned global South, will have been completed. The changes that are taking place are of historic proportions. By comparison, even the US elections are of limited significance. Many recognise that neither party, Democrat or Republican, has the answers to the needs and imperatives of the global community. The big question is whether the US and its NATO satellites will start a war whose consequences could be fatal for the entire planet. But this is not inevitable if the BRICS dynamic is gradually accepted in the transatlantic states as well. The realisation must prevail: BRICS is not a hostile military alliance, but a multipolar community of shared destiny based on development and progress. As the Russian President told the representatives of the BRICS media groups: “We are not turning anyone away; the door is open to everyone.”
