Analysis: China seeking an even bigger role in the Brics grouping
AS IT prepares to hold its annual summit in New Delhi on 28 March, the Brics grouping – Brazil, Russia, India, China, and South Africa – is still searching for a common identity and institutionalised co-operation.
Lack of common ground has prompted cynics to call the group an acronym with no substance. To its protagonists, it is a product of today’s ongoing global power shifts.
After all, the Brics economies are likely to be the source of future global growth. They represent more than a quarter of the Earth’s landmass, more than 41 per cent of its population, almost 25 per cent of world GDP and nearly half of all foreign-exchange and gold reserves.
At the summit, the Brics leaders will discuss the creation of joint institutions, particularly a common development bank. Failure to make progress on establishing an institutional structure, they will lend credence to the contention that it is merely a “talking shop” for countries so diverse that their shared interests cannot be translated into a plan of action.
For Brazil, Russia, India, and South Africa, the Brics grouping underscores their rising economic clout. But, for China, Brics offers tangible – not just symbolic – benefits. China has cast a lengthening shadow over the group, openly seeking to control the proposed common development bank.
As part of its quest for a global currency that could rival the dollar or the euro, a cash-rich China plans to extend yuan loans to other Brics members.
Lending and trading in yuan is likely to boost China’s international standing. But its undervalued currency and hidden export subsidies have been systematically undermining manufacturing, especially in India and Brazil.
Proponents of the Brics concept remain hopeful the group can serve as a catalyst for global institutional reform. With existing international arrangements remaining virtually static since the mid-20th Century, the world needs more than the half-hearted and desultory steps taken thus far.
China is not on the same page as the other Brics countries when it comes to global institutional reform. It is a revisionist power concerning the global financial architecture, seeking an overhaul of the Bretton Woods system. But it is a status quo power within the United Nations system, and steadfastly opposes enlargement of the Security Council’s permanent membership. It wishes to remain Asia’s sole country with a permanent seat – a stance at odds with Indian ambitions.
The Brics countries must agree on attainable political and economic objectives. They are generally united in their frustration with – but not in their proposed response to the dollar’s status as the world’s reserve currency. Indeed, the most important bilateral relationship each Brics country has is with the United States.
The Brics concept represents its members’ desire to make the global order more plural. But it is uncertain if the group will ever evolve coherent institutional mechanisms.
• Brahma Chellaney is professor of strategic studies at the New Delhi-based Centre for Policy Research
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