‘De-dollarization’, expansion and ‘cold war’ dominate BRICS meeting

TEHRAN- Russian President Vladimir Putin has told participants of the BRICS Business Forum that the de-dollarization process is irreversible across BRICS nations.

"A balanced, irreversible process of de-dollarization of our economic ties is gaining steam, with efforts undertaken to develop efficient mechanisms of mutual settlements, as well as monetary and financing control. As a result, the share of the dollar in export and import transactions within BRICS is declining as it only equaled 28.7% last year," Putin said.

The Russian President said that the three-day summit in South Africa's commercial capital Johannesburg would discuss in detail measures to switch trade between member states away from the U.S. dollar and into national currencies.

“The objective, irreversible process of de-dollarization of our economic ties is gaining momentum,” he said in a video address.

There has been common ground during the talks to seek alternatives to trading in U.S. dollars; as well as drawing up a framework on Wednesday for admitting new members to the bloc during the plenary session of the BRICS leaders.

In his opening remarks at the BRICS plenary session on Wednesday, South African President Cyril Ramaphosa said, "BRICS stands ready to collaborate with all countries that aspire to create a more inclusive international order."

He also pointed out, "The changes that have taken place in BRICS economies over the past decade have done much to transform the shape of the global economy. However, the new wave of protectionism and the subsequent impact of unilateral measures that are incompatible with WTO rules undermine global economic growth and development."

"We should let more countries join the BRICS family to pool wisdom and efforts to make global governance more just and equitable," Chinese President Xi says.South Africa's foreign minister also said an agreement has been reached on the expansion of BRICS. "We have agreed on the matter of expansion," Naledi Pandor said on Ubuntu Radio, a station run by South Africa's foreign ministry.

"We have a document that we've adopted which sets out guidelines and principles, processes for considering countries that wish to become members of BRICS…That's very positive."

The move paves the way for dozens of interested nations to become members.

Pandor says the bloc's leaders would make a more detailed announcement on expansion before the summit concludes on Thursday.

Chinese President Xi Jinping also told the plenary meeting that "international rules must be written and upheld jointly by all countries based on the purposes and principles of the UN Charter rather than dictated by those with strongest muscles or the loudest of voice…BRICS countries should practice true multilateralism, stick to solidarity and oppose division."

Xi also warned that "the Cold War mentality is still haunting our world, and the geo-political situation is getting tense."

"We should let more countries join the BRICS family to pool wisdom and efforts to make global governance more just and equitable," Xi added.

For his part, Prime Minister Narendra Modi said "India fully supports the expansion of BRICS, we welcome moving forward with consensus on this." It was his strongest endorsement yet on BRICS enlargement.

BRICS has focused on boosting economic and trade cooperation between member countries Brazil, Russia, India, China, and South Africa; and is now finalizing ways to expand its members.

Brazilian President Luiz Inacio Lula da Silva also noted that "it is very important for Argentina to be in BRICS."

Argentina is struggling with debt repayments as part of a $44 billion loan deal with the International Monetary Fund (IMF) that has resulted in historic inflation and dried-up foreign reserves.

Lula denounced the IMF loans as "suffocating" and raised the possibility of the BRICS bank increasing lending to other countries with a "different criteria" to improve their economies.

Critics of the IMF have echoed Lula's remarks on its loan bailouts to countries whose economies, societies and governments end up suffering from the terms attached to the loans, which force authorities to take austerity measures to meet the IMF's bailout conditions.

As a result of the IMF conditions, economic development slows down, poverty and inflation rise and societies end up more unequal.

President Lula also declared he was in favor of more countries joining the alliance as well as a common currency used by BRICS countries in commercial transactions that would reduce their vulnerabilities.

In his speech at the business forum, he added that new partners would help BRICS increase its relevance on an international scale.

"We want BRICS to be a multilateral institution, not an exclusive club," Lula pointed out.

South Africa said last month that more than 40 other nations had expressed interest in joining the organization.

President Putin told the plenary meeting that Russia's special military operation pursued the goal of ending the war in Ukraine unleashed by a number of Western countries and their satellites.

"Russia has decided to support the people who are fighting for their culture, for their traditions, for their language and for their future. Our actions in Ukraine have only one reason – to put an end to the war that was unleashed by the West and their satellites in Ukraine against the people living in Donbas," Putin said via video link.

Donbas is the eastern part of Ukraine where a deadly conflict between ethnic Russians and the Ukrainian military erupted in 2014.

Calling for "a multipolar world order," he stressed that it was the wish of a number of Western countries to preserve their hegemony in the world that "has led to the grave crisis in Ukraine."

On Tuesday, Xi told the BRICS business forum that China's economy was resilient and that the fundamentals for its long-term growth remained unchanged.

"The Chinese economy has strong resilience, tremendous potential, and great vitality," he said.

At a briefing on the sidelines of the summit, China's top diplomat for Africa highlighted how Beijing is tapping into the African market where there is great potential.

"African integration is already escalating, and many African countries have asked China to consider a shift of our focus," said Wu Peng, director-general of China's Department of African Affairs at the Foreign Ministry.

"No matter what happens about the global economy, or Chinese economy, the trend in the relatively midterm or long range, is that Chinese companies are willing to take some risk to go into Africa," Wu added.

All eyes are on this year's economic organization, which is meeting in person for the first time since the COVID outbreak.

Analysts say BRICS has already exceeded the G7 in terms of economic clout and with new members, such as Saudi Arabia, Iran, Nigeria, Indonesia, and many others expected to join.

Some believe that over the next five years, BRICS will potentially be the only global institution whose economy will matter because of the significance of the countries that are involved.

Brazil, Russia, India, China, and South Africa are already important economies. The addition of other countries would make the BRICS market a game changer globally, geo economically and geopolitically as well.

Reports suggest significant development has been achieved on the expansion of BRICS during the Wednesday meeting of the BRICS leaders.

Experts believe there are a number of reasons why many countries have signaled their interest in joining the bloc.

Topping that list undoubtedly is the war in Ukraine, which has played a significant role in the shift it has created within geopolitics. Many countries have seen the bullying nature of the West, in particular the United States and other NATO members pressuring other countries to join the war and take sides. Something that is not very pleasing for the international community to watch.

The method and decline of U.S. hegemony over the past 30 years have attracted many states to seek alternative multilateral organizations for fair trade and market practice.

The fair economic practices of BRICS countries in their different respective regions, even if their political views do not see eye to eye on everything, have made the organization successful.

The bloc’s annual rotating chair will see next year’s BRICS summit hosted by Russia in the southwestern city of Kazan where the country will seek to strengthen the bloc’s role and authority under its chairmanship.

The same can be said for other international blocs such as the Shanghai Cooperation Organization.

Source: Tehran Times