BRICS’ FM meet

Context

During the discussion of BRICS nations’ Foreign Ministers (FM) at Cape Town, South Africa, a geopolitical consolidation of the grouping has been proposed to expand the membership of BRICS, and a common currency.

About BRICS:

The BRICS countries comprise Brazil, Russia, India, China, and South Africa, and represent the largest developing economies.
Founded in: 2006
It is pertinent to note that the countries together represent 41% of the world’s population, around 25% of global GDP and around 20% of world trade.
Subsidiary: New Development Bank
Aim: The BRICS mechanism aims to promote peace, security, development and cooperation.
The five nation powerful grouping has been discussing and deliberating on issues of common concern for all developing countries.
BRICS countries have regularly called for reform of the multilateral system in order to make it more representative and inclusive.

Highlights of the meet:

The foreign ministers’ meeting will finalise the agenda for the 15th BRICS summit scheduled to be held in South Africa in August, 2023.
Two items on the agenda are attracting notice;
- A plan to expand the membership of BRICS, and a common currency.
South Africa is going to conduct the BRICS summit for the year 2023 and also hosting a Friends of BRICS meeting, with 15 foreign ministers from Africa and the Global South.

The theme of upcoming BRICS summit 2023 is: “BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development, and Inclusive Multilateralism”.

Significance of the meet:

Talks on a Common Currency:
- The idea of a common currency was proposed by Russia’s President Vladimir Putin at the Beijing BRICS summit 2022.
- A committee will be formed to study the viability of the idea.
- The last year of Russia-Ukraine war has seen economies around the world feel the impact of the sanctions, the resultant spike in energy prices, combined with the rising value of the dollar.
- Thus, the idea of common currency can boost the trade relations between the member countries also in a situation of conflict.

Challenges associated:

The complications in implementing a common currency can be such as the setting up of a common central bank of member countries that have different economic and political systems and are located on different continents.
Most among the BRICS nations are developing countries in nature and thus they are facing a growth crisis which can become a challenge to economies bring a common ground of exchange.

Future aspirations of the BRICS grouping:

Looking for Multi-polarity:
- As many as 19 countries are said to be in the queue to join BRICS.
Strengthening a Global South:
- To break the hegemony of Dollar and make the other currency competitive, the step of common currency is seen as progressive.
- However, the nation’s comprising Global south has made a clear indication for West, as they also are keeping the pace to become one amongst them.