NEW YORK. «The BRICS are very different countries which complicate the alignment and functionality of the group on various fronts, with the result that the effectiveness of its actions is much more limited than that of the G7». The judgment on the work of the Johannesburg summit is from Ian Bremmer, founder of Eurasia Group.
Can the BRICS really be the alternative to the G7?
«The G7 is a group of democratic states and advanced economies, in the BRICS there is a bit of everything. China and Russia are two dictatorships, India, Brazil and South Africa are democracies. So it is a multifaceted nucleus that brings together countries from all over the planet indifferently».
What does this entail?
«This makes it difficult for the BRICS to be a cohesive and aligned group on several fronts. No doubt by coming together they are creating a more economically powerful community and are gaining influence globally, especially in the face of a less substantial G7 in terms of growth. But the G7 is absolutely more aligned than the BRICS”.
Can you go into detail?
«This happens for various reasons, China, for example, is no longer de facto part of the southern hemisphere, it has become the largest creditor of the southern hemisphere and the countries that belong to this grouping therefore try to have good relations with Beijing. Just as they are looking for them with the United States and do not want the BRICS to represent an opposing group such as to create a sort of cold war with the G7. Then there is India which in terms of relations with China is the most uncertain and from a geostrategic point of view is closest to the USA, in particular with Narendra Modi, through the Quad (the quartet that brings together the United States, India , Australia and Japan, established in 2007 with the aim of countering the growing influence of China in the Asia-Pacific region). This makes strategic alignment by the BRICS even more complicated».
And Russia?
«Lastly we have the fact that Vladimir Putin was unable to go to the summit in person due to the international arrest warrant, this is a point in favor of the G7 and at the same time an element of concern for the BRICS. All member states want the conflict in Ukraine to end as soon as possible but it is difficult, and Russia is primarily responsible for it. This is why I say that the BRICS remain hostage to what they can and cannot do».
But there are concrete efforts, don’t you think?
«Of course, like the attempt to increase investments and trade between the BRICS in local currency, but as long as the dollar remains the official currency of the planet’s reserve, I don’t think there are any risks for the greenback. The BRICS are not prepared to create an alternative single currency at the moment, but there is a clear effort to limit the use of the dollar as a weapon.
But does the group represent the majority of the planet’s population?
«The big problem of the BRICS is that globalization is no longer as fast as it has been in the last fifty years. In half a century the middle class has grown a lot from a global point of view, the next ten years will be much more complicated in these terms. India’s trajectory will strengthen a lot, Brazil too, but China not necessarily because it is no longer the world’s factory, there is a lot of “decoupling”, separation of production from the point of view of localization, and there is a return of production at home. Those mechanisms that facilitated the greater integration of the BRICS with the rest of the world are becoming less effective”.
Speaking of China, what risks does the real estate bubble entail?
“It reduces global growth. When there was the pandemic, China got up first and drove the recovery, now the situation is the opposite. There is global inflation, rebounds in the global economy and uncertainty in growth. This means a contraction in global demand for raw materials and Beijing’s less ability to drive global growth. However, I do not see a risk of contagion on global real estate but without a doubt repercussions on the global economy and this could become a structural problem”.
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