It is not yet known whether Brics will
assume a new name in accordance with its
enlarged format. For now, let’s call it the
G11, to distinguish it from the G7.
With further enlargements, the G11 could
soon resemble a G20 without western
countries. The original G20, where the
Global West and parts of the Global Rest
have mingled for decades, could become
irrelevant.
Summary judgments
The Global West and its mainstream media
have been dismissive towards Brics, focusing
on its shortcomings and internal tensions.
At best, they considered it an
uncoordinated, weak and fragile economic
club. At worst, an unrealistic and
heterogeneous group of countries committed
to launching an inept alternative global
governance system. In other words, they
viewed it as a clumsy and naive attempt to
move from the US-led rules-based world order
to an undefined and unpredictable
multilateral one.
To a certain extent, such judgements have
merit. Brics - and now the G11 - cannot
boast the solid mechanisms of interaction,
consultation and action that have long been
the Global West’s prerogative via the G7,
Nato, the EU, Aukus - and other forums.
Brics, after all, arrived late in the
“global governance business”, which was for
decades a western prerogative, conceived of
and led by the US. Yet such summary
judgments further confirm how dangerously
dissociated from reality the Global West’s
members continue to be.
If Washington and its main allies had not
squandered the extraordinary victory
achieved with the end of the Cold War and
the dissolution of the Soviet Union, and had
not abused their positions, Brics would
likely never have been born.
After all, in the last three decades, the
Global West has inflicted upon humankind
long wars that contravened international
law, unilateral sanctions, a weaponised
dollar, hypocritical macroeconomic
adjustment plans, and overzealous “green
transition” rules applied with a glaring
double standard (the latest example being
Japan, which to the deafening silence of its
G7 partners, has started pouring into the
Pacific Ocean 1.3 million metric tonnes of
radioactive water from the Fukushima
nuclear plant).
The rise of Brics reflects a growing
unease in large parts of the Global Rest
with the Global West’s policies over the
last few decades. Its enlargement is
evidence that this reaction is reaching a
critical mass. What is surprising is not the
fact that the Global Rest is having this
reaction, but rather that it took so long to
manifest.
It would be a mistake to interpret this
trend as blind anti-western drive, fuelled
by old grievances over past colonial
policies or unilateral moves during
Washington’s unipolar moment. The Global
West is falsely promoting the notion that
the world system has reached an epic
inflection point characterised by a
confrontation between
democracies and autocracies, based on
the die-hard “either with us or against us”
logic. The leaders of the Global West today
appear incapable of conceiving global
politics in a framework beyond the binary
Cold War mindset.
While China and Russia remain the top two
players within Brics, India’s role is
increasing. But neither Beijing nor Moscow
hold a hegemonic position within the group
akin to the role of the US within the main
articulations of the Global West. Brics, and
now the G11, prefer to operate through
consensus, which has its own adverse
effects.
Shifting trade dynamics
The G11’s military dimension is
embryonic, to say the least. But this should
not imply that the increasing coordination
of its members does not constitute a threat.
They seem committed to
de-dollarisation and the launch of a
financial system outside of New York and
London clearinghouses and US Treasury rules.
In due course, this could weaken American
global power, widely rooted in the US dollar
as the global reserve currency.
Russia is already out of western
financial circuits. China is doing its best
to follow. It is premature to talk about a
G11 currency, but the founders’ five
currencies could play an increased role in
bilateral trade among members.
Saudi Arabia, the UAE and China are
increasingly divesting from US debt by
selling
US Treasury bonds. One of the
cornerstones of the global energy trade and
of US financial power, the petrodollar, is
creaking. Russia is asking for
rubles pegged to gold for its oil, while
China is pushing to pay for its
energy supplies from the Gulf in
renminbi.
If within Opec+, where Saudi Arabia and
Russia determine global oil output quotas
and therefore its price, the transition
continues from the petrodollar to
alternative currencies, then the
implications for the dollar’s status could
be massive. There is the potential risk of a
bandwagon effect. This trend could even
extend to green energy, since the related
raw materials and manufacturing capabilities
are likewise significantly located among G11
members.
Brics and its new members have reached a
delicate crossroads of energy trading and
payment systems, which in due course could
usher in a Bretton Woods III, reshaping
global energy and financial politics.
Current and potential future members of the
Brics/G11 bloc will all be united by the
common aim of disrupting the US dollar’s
dominance. The implications could be huge,
especially if ad hoc arrangements for
trading in local currencies lead to the
creation of specific regional trading
blocs.
To be sure, the US dollar will not lose
its status overnight, but Washington should
pay attention to these developments. And
going forward, it should be more cautious
about weaponising its currency, as it has
done compulsively for decades.
The recent
freezing of Russian (and
Venezuelan) hard currency reserves held
in western banks may soon turn out to be one
of the biggest mistakes of the 21st century.
From the perspective of the Global Rest, the
unequivocal message of such moves is akin to
the one received by an ordinary citizen who
goes to his local bank branch, only to have
his savings withdrawal request rejected.
There is a new world out there. The green
note is losing much of its attractiveness.
At the same time, its master no longer
inspires fear or respect.
