George Galloway, a British politician, has likened the Kazan summit of the Brics (Brazil, Russia, India, China and South Africa) group to the 1944 Bretton Woods conference.
"The children unborn will grow up in a world shaped by Brics 2024," he said in a video posted on social media during the bloc's conference in the Russian city last month.
"This is the future; this is a new world that is struggling to be born, no doubt. But it is being born ineluctably. Once the process of labour has begun a birth is inevitable. People will be exchanging commodities within the Brics countries in local currencies. The dollar is beginning to die," he concluded.
Mr Galloway may appear to some a bit too excited about the ascent of Brics - or conversely, the diminishing US global economic influence. Yet the fact remains that the group's growing influence is signalling a shift away from Western dominance and towards a more multipolar world, helping shape a more just and democratic future.
Essentially, Brics comes across as an initiative fundamentally based on equality among its member states. What else makes it unique is that it is the first major international initiative not led by the US since World War II that can help shape the new world order.
Brics summit criticises Western trade barriers while reiterating its goal to encourage the use of local currencies in international trade
At Kazan, member countries reaffirmed their commitment to strengthening cooperation in various areas, including trade, investment, finance, technology, and culture as they have already established a number of mechanisms for cooperation: the Brics New Development Bank, the Brics Contingent Reserve Arrangement, and the Brics Business Council. They also discussed ways to address global challenges, such as climate change, poverty, and inequality.
In recent years, the organisation has successfully projected itself as an alternative to Western-led models of global governance. It is becoming more prominent and influential as it capitalises on the growing dissatisfaction with the US policies of using unilateral economic sanctions against others as a political weapon and protectionist trade policies to beat competition.
The organisation has broadened its geographic and economic diversity by welcoming 13 new member states, while 21 others await approval
The goals espoused by the group are more or less the same as enunciated by the Shanghai Cooperation Organisation, of which Pakistan is also a member, in its Islamabad moot a week before the Kazan summit.
Brics is a group of countries with different political and economic systems that have demonstrated a remarkable capacity for cooperation and consensus-building despite their internal differences, as they share a common interest in challenging the existing global order, which they see as unfair and unjust.
One of the most significant outcomes of the summit was the decision to accept 13 new partner countries to join the group: Algeria, Belarus, Bolivia, Cuba, Indonesia, Kazakhstan, Malaysia, Nigeria, Thailand, Turkey (a Nato member), Uganda, Uzbekistan, and Vietnam. Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates have already joined the bloc.
This expansion reflects the growing interest in joining the group and its challenge to the existing, dying global order. The requests of 21 countries to join the group are still pending. The addition of these new members will significantly increase the geographic and economic diversity of the Brics group.
If anything, the Kazan communiqué is a blueprint for strengthening multilateralism, emphasising a cooperative global approach towards establishing a "more just and democratic world order" as the discussions ranged from geopolitics and narcotics to alternative payment systems to the dollar to artificial intelligence and even the preservation of big cats.
It focuses on three verticals: promoting international peace and security; encouraging international economic and financial cooperation; and fostering social and cultural cooperation involving people-to-people exchanges. BRICS criticises the Western countries' use of sanctions and wants to increase the use of local currencies in member states' financial transactions to decrease their reliance on the dollar. At the same time, however, it calls for reforming the Bretton Woods institutions, rather than creating full-blown alternatives.
The main issue discussed at the summit was the creation of a BRICS-led payment system to rival Swift. "We recognise the widespread benefits of faster, low cost, efficient, transparent, safe and inclusive cross-border payment instruments built upon the principle of minimising trade barriers and non-discriminatory access. We welcome the use of local currencies in financial transactions between BRICS countries and their trading partners," the communique said.
The organisation's members also agreed to discuss and study the feasibility of establishing an independent cross-border settlement and depositary infrastructure, BRICS Clear, an initiative to complement the existing financial market infrastructure, as well as BRICS independent reinsurance capacity, including BRICS (Re)Insurance Company, with participation on a voluntary basis.
Many members are already using local currencies in trade transactions among themselves and also with other willing trading partners. As the community observed: "We are deeply concerned about the disruptive effects of unlawful unilateral coercive measures, including illegal sanctions, on the world economy, international trade, and the achievement of the sustainable development goals." At the same time, the group has asserted the need for preservation of, and improvements in existing global financial governance.
"We reaffirm our commitment to maintaining a strong and effective Global Financial Safety Net with a quota-based and adequately resourced IMF [International Monetary Fund] at its centre," the communique said
Published in Dawn, The Business and Finance Weekly, November 4th, 2024