BRICS Contingent Reserve Arrangement

Ethiopia wants to join the BRICS group of nations: an expert unpacks the pros and cons

Retrieved on:

Tuesday, July 11, 2023

Brazil, Russia and South Africa are primarily natural resource exporters and were badly affected by the global commodity price bust of 2014.

Key Points:

Brazil, Russia and South Africa are primarily natural resource exporters and were badly affected by the global commodity price bust of 2014.
Russia’s invasion of Ukraine has now given BRICS a new geopolitical salience as the members and their respective allies respond to events.
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South Africa's role as host of the BRICS summit is fraught with dangers.

In my opinion, there are five key reasons why Ethiopia would want to join the grouping.
Deteriorating relations with western powers: Ethiopia has historically depended on substantial western support through aid and security cooperation.
But its relations with the west have soured as a result of the civil war, in which it human rights violations were reported.
China and India are now Africa’s two largest single trading partners (not counting the European Union as a single entity).
Joining the BRICS club would show that his government is still politically acceptable to some major world powers.

There would of course be risks in Ethiopia joining the BRICS.
Western powers might perceive it as drifting into the alternative geopolitical bloc or alignment, which could reduce aid and investment from them.
But this could also have advantages for Ethiopia’s relations with the west by making the country more geo-strategically important.
But in some ways Ethiopia might be seen as a more representative African country in BRICS than South Africa.

Retrieved on:

Friday, June 2, 2023

South Africa will host the BRICS summit in August 2023.

Key Points:

South Africa will host the BRICS summit in August 2023.
South Africa could face the wrath of its BRICS partners if it fulfils its international obligation and arrests him.
Hosting the 2023 BRICS summit is therefore fraught with dangers.

These countries decided that Goldman Sachs had a point and that they could enhance their global influence if they cooperated.
They first met at a ministerial level in 2006 and at a leaders’ summit in 2009.
The group has also sought, through groups like its business forum, to promote greater economic cooperation between the participating countries.

They contend that it is a “new” multilateral development bank which offers its members an alternative to institutions like the World Bank.
It claims that its governance is fairer than the World Bank because its five original members all have equal votes.
It has provided US$32.8 billion to 96 projects in the 5 BRICS countries and it has begun looking to expand the scope of its operations.
But another important reason is that the BRICS are not unified in their demands for reform.
Similarly, not all the other BRICS have supported South Africa’s call for a third African seat on the IMF’s board of directors.

These changes have created both opportunities and challenges for the BRICS.
One opportunity arises from the fact that approximately 19 countries in the Global South, including Argentina, Cuba, Iran and Saudi Arabia, have expressed an interest in joining the BRICS.
It is expected that the BRICS will consider the issue of membership at their upcoming August 2023 summit.
However, given the complex economic and political relations between the BRICS member states, there is considerable scepticism about the feasibility of the BRICS developing a new global currency in the near term.

The G20, which brings together the 20 leading economic powers in the world, has called itself the “premier forum” for global economic governance.
Planning for this G20 event must begin soon because in 2024 South Africa will join India, the current G20 host, and Brazil, the 2024 G20 host in the troika that manages the G20 process.