BRICS Summit Day 1 Highlights
Eight Highlights of The Much Anticipated BRICS Summit
Here is the rundown of some highlights of day one of the BRICS Summit in South Africa.
1. South Africa, China, Russia Eager to Expand BRICS Bloc, While India and Brazil are ‘Relatively Skeptical’ of Expansion
Financial Times reported in “South Africa and China Find Common Ground on BRICS Expansion”:
South Africa’s Cyril Ramaphosa said that “South Africa and China have similar views on the expansion of Brics membership”
…Brazil’s president Luiz Inácio Lula da Silva and Indian prime minister Narendra Modi are also in attendance at the BRICS summit, with their governments relatively skeptical of expansion on terms that would dilute their influence in the bloc and embellish China’s claim to lead the developing world.
Reuters reported in “BRICS Divisions Re-Emerge Ahead of Critical Expansion Debate”:
Comments from Brazil's Lula pointed to a divergence of vision within the bloc, which political analysts say has long struggled to form a coherent view of its role in the global order.
"We do not want to be a counterpoint to the G7, G20 or the United States," Brazil's Lula said on Tuesday during a social media broadcast from Johannesburg. "We just want to organize ourselves."…
India, which is wary of Chinese dominance and has warned against rushing expansion, has "positive intent and an open mind",
Foreign Secretary Vinay Kwatra said on Monday. Brazil, meanwhile, is concerned that expanding BRICS will dilute its influence, though Lula reiterated on Tuesday his desire to see neighbor Argentina join the bloc.
Reuters would also note that “..Russia is also keen to expand membership while South Africa's President Ramaphosa voiced support for the idea at the meeting with Xi.", concluding the article by noting:
“While a potential BRICS enlargement remains up in the air, the grouping's pledge to become a champion of the developing world and offer an alternative to a world order dominated by wealthy Western nations is already finding resonance…”
Brazil seems to be concerned of expansion for fear of being generally diluted in its influence, and has traditionally opposed expansion, while India is more explicitly worried about the country becoming China-centric, as I talked about in my recent July article recapping the past year and a half of developments since I predicted the rise of BRICS in March 2022.
The End of The PetroDollar, The Rise of BRICS is Here
The question isn’t will BRICS allow new members, but who those members will be, how they will be picked.
South Asia Index expanded on the contention between India and China within the BRICS bloc, as China is trying to fast track Pakistan whom India has notoriously bad ties with, like India does China.
On Aug. 2nd, Reuters published the headline “Brazil Now Main Holdout Against BRICS Expansion, Sources Say”
Brazil has resisted gathering momentum in the BRICS group of major emerging economies to add more member countries, but debate over admission criteria seems inevitable at this month's summit, three Brazilian government officials told Reuters.
2. Argentina Was Favored by Brazil, ‘Main Hold Out’ For BRICS Expansion, Now in question Due to Javier Milei
While Brazil is the “main hold out” now, and has “long-resisted expansion”, they do want Argentina to join. But now that is thrown into question with the recent win by Javier Milei in the presidential primaries.
As South China Morning Post(SCMP) noted in “At BRICS Summit, Argentina’s Bid for Membership Is up for Discussion and Subject to Debate”:
“Brazil, fearing BRICS would become an anti-Western club that could harm its interests in the US and Europe, has long resisted expansion”, Lula had pivoted last year after being elected president, and “for the first time spoke openly in favor of Argentina joining the group”.
But Libertarian Javier Milei’s victory in the presidential primaries for Argentina has raised questions. SCMP reported:
…The results of Argentina’s presidential primaries – in which the far-right libertarian Javier Milei emerged as the favourite for the October election – may have jeopardised the nation’s candidacy and renewed a sense of caution about admitting new members to Brics.
...Milei has made belligerent comments about Brazil – threatening to withdraw from Mercosur – and suggested he might freeze diplomatic relations with China. His remarks pose a problem for Argentina’s Brics application, given the risk that if elected president, he might order an immediate withdrawal from the group.
...“The worst scenario would be for Argentina to enter and leave in a few months.”
She added: “It goes against the interest of every member of the bloc, and there is no solution yet. How this is to be addressed remains at the heart of the matter.”
The Rio Times reported yesterday, “Argentina Will Not Join the Brics Group; Alberto Fernandez Has Renounced Participation in the Summit”
”Official sources confirmed on Monday that Argentina’s integration into the BRICS group is not on the horizon, writes EFE agency in its latest report.”
3. South African President Declares Intent for Africa to Industrialize, Produce Finished Products Instead of “Rock and Sand”
Ben Norton: At the BRICS summit, South Africa's President Cyril Ramaphosa emphasized that the African continent has massive supplies of natural resources, but it wants use those to industrialize and create high value-added products, not simply export raw materials to rich countries
“Africa is a continent of great opportunity in industrialization process in a variety of sectors. This continent is rich in the critical minerals that will drive business success in the 21st century.
The continent has resources of vanadium, cobalt, platinum, palladium, nickel, copper, rare earth minerals, rhodium and many others...
...The investors of choice are those who will come and invest in our continent but also process the resources here, close to source - so that African countries do not export rock and sand, but export finished products, as we would like to do."
4. China Says African Countries Want Industrialisation over Infrastructure
African countries want China to shift its focus from building infrastructure on the continent to local industrialisation, China's top Africa diplomat said on Tuesday at a briefing on the sidelines of the BRICS summit in South Africa.
"African integration is already escalating and many African countries (have) asked China to consider (a) shift (of) our focus," Wu Peng, director-general of China's department of African affairs at its foreign ministry, said.
Wu said the change was needed especially considering the Africa Continental Free Trade Agreement (AfCFTA), which was launched at the start of 2021 and is intended to enable African countries to trade tariff-free in future.
5. BRICS New Development Bank To Begin Lending in South African, Brazilian, Indian Currencies, Strives to Reduce Reliance on the Dollar
The NDE is going to being lending in the Brazilian, Indian and South African currencies.
Financial Times reported:
“The development bank set up by the Brics nations plans to begin lending in the South African and Brazilian currencies as part of a plan to reduce reliance on the dollar and promote a more multipolar international financial system, according to its president.”
….And also in rupees.” The bank already lends in renminbi…
The expansion of lending in local currency supports a wider objective agreed by the Brics nations of encouraging the use of alternatives to the dollar in trade and financial transactions.”
In July in “End of the Petrodollar, Rise of BRICS”, I wrote:
The outcome of India’s rejection of the common currency proposition is BRICS agreeing to continue de-dollarization and expand trade in their domestic currencies - BRICS currencies are being termed the “R5”.
India’s objection seems to have made an impact on the agenda for the Summit as in the process of writing this, even after the Russian Embassy announced a gold-back BRICS currency was to be discussed at the upcoming BRICS summit, BRICS officials recently clarified that discussion at the BRICS summit would actually stay away from a BRICS common currency and instead focus on de-dollarization by expanding trade in national and local currencies over the dollar.
Discussion of a BRICS common currency in the future is still on the table, but the vice president of the BRICS New Development Bank said that “The development of anything alternative [to trading in nationalcurrencies” is indeed a medium to long-term ambition.””
Reuters — BRICS Bank’ Aims to Issue First Indian Rupee Bond by October
6. Saudi FM Leaves for South Africa to Attend BRICS Summit
Saudi Gazette would report on the Saudi Foreign minister leaving Saudi Arabia for BRICS last minute on day one of the BRICS summit:
On behalf of Crown Prince and Prime Minister Mohammed bin Salman, Foreign Minister Prince Faisal bin Farhan is leading Saudi Arabia’s delegation attending the BRICS Plus Dialogue and BRICS-Africa Outreach conference. The foreign minister has left on Tuesday for South Africa.
The session, with the theme “BRICS and Africa: Partnership for mutually accelerated growth, sustainable development, and inclusive multilateralism,” will be held on Thursday, Aug. 24, in Johannesburg.
The BRICS Plus and BRICS Africa dialogue will discuss many developments in the international arena and the global challenges. It will also discuss sustainable solutions to the challenges the world is witnessing, including the issues faced by BRICS and the Global South to build mutually beneficial partnerships in a multi-polar world.
The dialogue conference will be held on the sidelines of the 10th BRICS summit that began on Tuesday and will conclude on Thursday. The theme of the 15th annual BRICS summit is “BRICS in Africa: Collaboration for Inclusive Growth and Shared Prosperity in the 4th Industrial Revolution.
The Saudi Gazette would go on to note that the expansion of BRICS is at the focus of the summit, and that “Saudi Arabia, which is the largest trading partner of the BRICS group in the Middle East, is one of the applicants…. It has received backing from Russia and Brazil to join the BRICS.”
“Around 40 countries have expressed their interest to join BRICS, while 23 countries have formally applied, including Saudi Arabia, Argentina, Iran, the United Arab Emirates, Indonesia, Thailand, Cuba, Egypt, Nigeria. Saudi Arabia was among more than a dozen countries that participated in "Friends of BRICS" talks in Cape Town in June.
….Saudi foreign minister’s assertion that his country is keen to develop future cooperation with the BRICS group by exploiting the capabilities and potentials possessed by the Saudis and the BRICS countries, with the aim of achieving common interests and prosperity for all. The BRICS member states and Saudi Arabia share basic values such as respect for the sovereignty of states, non-interference in their internal affairs, adherence to international law, collective action and cooperation in facing common challenges.”
In contrast to the controversial members like Pakistan, or Argentina, Saudi Arabia may be one of the most suitable applicants for BRICS in this point of contention between BRICS members, as they have forged ties with all of BRICS. In this author’s opinion, it is probable they will be one of the first countries to be accepted.
Buenos Aires Times reported in “Join the club: BRICS Faces Rift Over Push for New Members”
Cobus van Staden, a senior researcher at the South African Institute of International Affairs, said even admitting less controversial members could greatly impact the profile and clout of BRICS.
"For example if Saudi Arabia joins, that would also kind of bring some additional geopolitical weight to the bloc," he said.
Three aspiring members – Bangladesh, United Arab Emirates and Egypt – were admitted in recent years to the BRICS development bank that wants to offer an alternative to the World Bank and International Monetary Fund.
7. ‘India is the fastest-growing major economy in the world,’ says PM Modi, ‘India Will Soon Become a $5 Trillion Economy’
“Despite turbulence in global economic situation, India is the fastest-growing major economy in the world. Soon, India will be a 5 trillion dollar economy”, PM Modi said at BRICS Business Forum Leaders' Dialogue in Johannesburg, South Africa.
'No doubt that in coming years, India will be growth engine of the world', PM Modi, at Brics in Johannesburg
8. China’s Xi Attends BRICS Dinner But Skips Business Forum Where He was Scheduled to Speak:
Bloomberg: China’s Xi Skips Scheduled Speech to BRICS Business Forum
Reuters reported: “It was not immediately clear why Xi, who had a meeting with host Ramaphosa earlier in the day, did not attend.”
