The BRICS leadership has resolved to extend invitations to six additional nations to join their alliance including Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates.
Their membership will take effect January 1, 2024.
The decision to expand the alliance reflects a recognition of the challenges in deepening the existing BRICS partnership. Despite collectively representing a substantial portion of the global GDP, the member countries exhibit varying interests. These range from China's ascent as a global superpower to India's policy of nonalignment and Brazil's prominence as an agricultural exporter. Some of the prospective new members, notably Saudi Arabia and Iran, have historically experienced strained relations, raising questions about the potential for unified actions beyond enhancing Middle Eastern and African representation within the bloc.
Delegates from the BRICS group, comprising Brazil, Russia, India, China, and South Africa, convened in Johannesburg for their 15th summit. This marked the first in-person summit since the onset of the COVID-19 pandemic.
Earlier in the current month, news emerged that over 40 nations had expressed a keen interest in seeking membership within BRICS. This included 22 countries that had formally submitted requests to join the alliance.
Will BRICS smash the dollar?
BRICS aims to pursue its objectives by challenging a fundamental aspect of US influence: the global reserve currency status of the dollar. Brazilian President Luiz Inacio Lula de Silva has advocated for BRICS nations to establish their own currency, while India is actively promoting the use of Indian rupees in trade with partners, including Russia, in lieu of US dollars. Additionally, there are reports suggesting that China and other BRICS members are considering alternatives such as gold for international trade, moving away from reliance on the dollar.
Following President Richard Nixon's decision to decouple the dollar from the gold standard in 1971, Henry Kissinger engaged in negotiations with Saudi Arabia. In this agreement, Saudi Arabia committed to using the US dollar for its international oil transactions in exchange for diplomatic and military support from the United States. This arrangement, often referred to as the "petrodollar," has played a crucial role in upholding the dollar's status as the world's primary reserve currency.
Earlier this year, Saudi Arabia entered into a noteworthy agreement with Brazil, agreeing to accept the Brazilian currency rather than the US dollar for oil purchases. If Saudi Arabia proceeds to establish similar agreements with other BRICS nations, it could potentially accelerate the decline of the US dollar's dominance as the global reserve currency.
Image by kirill_makes_pics from Pixabay
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