The BRICS group—comprising Brazil, Russia, India, China, and later additions like South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates—has been touted as an alternative global economic bloc that could challenge the dominance of Western institutions and currencies, particularly the U.S. dollar. However, as noted by Jim O’Neill, the former chief economist of Goldman Sachs who coined the BRIC acronym, the prospect of BRICS significantly altering global economic dynamics remains, at best, a lofty ambition clouded by internal divisions—most notably between its two heavyweights: China and India.
The BRICS summit serves as a platform for member nations to affirm their solidarity and cooperativeness, particularly in the face of Western sanctions, such as those imposed on Russia due to its actions in Ukraine. While Russian President Vladimir Putin presents the group as a united front against Western influence, O’Neill argues that the underlying tensions between China and India continue to undermine the potential effectiveness of BRICS. Despite accounting for a substantial portion of the world’s population and economic output, the group’s coherence and actionable objectives remain questionable.
O’Neill suggests that current BRICS activities are largely symbolic. The summits are more a demonstration of mutual support than a forum tackling specific global challenges or achieving substantial progress. The stark reality is that any concerted effort to challenge the U.S. dollar through an alternative currency or financial system is hampered by the countries’ inability to agree on fundamental economic issues and their conflicting national priorities. Without genuine collaboration—especially between the two largest members—the dream of BRICS as an alternative economic powerhouse seems increasingly tenuous.
Historically, the BRICS nations were seen as a collective with the potential to reshape global governance. During the inception of the acronym in 2001, the emphasis was on the individual growth trajectories of each nation and the necessity of their inclusion in international governance frameworks. However, over the last two decades, there has been a realization that the group lacks cohesion. Each member often pursues its own geopolitical and economic agendas, leading to a disjointed approach towards any unified economic policy.
As O’Neill highlights, continuous discussions about challenging the U.S. dollar, which have been ongoing since his entry into the finance sector, have yet to materialize into actionable alternatives. For instance, while there have been talks about establishing a new payment platform among BRICS members, the realization of such a system is currently speculative and would almost inevitably rely predominantly on the Chinese economy. This raises uncertainties regarding the viability of a BRICS currency when one member holds such considerable sway over the potential economic infrastructure of the group.
For BRICS to evolve from a mere symbolic gathering to a genuine economic club, a fundamental shift in mindset and practice is essential. O’Neill argues that instead of focusing on grandiose plans to counter the dollar, member nations should concentrate on fostering trade with reduced tariffs among themselves. This pragmatic approach could lead to tangible benefits and perhaps forge a stronger alliance based on mutual economic interests.
Yet, history has shown that India has been hesitant to embrace greater economic cooperation with China, driven largely by border disputes and security concerns. While recent talks have opened channels of communication after a five-year hiatus, the real test lies in their ability to cultivate trust and align their economic strategies effectively. If China and India remain at odds, the potential for BRICS to present a credible alternative to the global financial order will remain dubious.
Compounding the challenges faced by BRICS is the broader context of global governance. O’Neill points out that forums like the G20, initially seen as a solution to the failures of previous institutional frameworks, have also struggled to achieve unity, primarily due to the inward turns taken by both the United States and China. As global issues, such as climate change and public health crises, increasingly require coordinated responses, the inadequacy of BRICS to tackle these challenges becomes apparent.
While BRICS symbolizes a collective of countries striving to assert their importance on the world stage, the reality is that internal discord—particularly between China and India—undermines its effectiveness. Until there is genuine cooperation based on shared economic goals, the challenge to the dominance of the U.S. dollar and the quest for a multipolar world order will remain a distant aspiration, relegated to discussions rather than actionable plans.