Understanding BRICS

In November 2001, Goldman Sachs economist Jim O'Neill published a paper titled Building Better Global Economic BRICs. The paper argued that four large emerging economies - Brazil, Russia, India, and China - were growing so fast that they would collectively reshape the global economy within a decade. O'Neill bundled them under the catchy acronym BRIC, and it stuck.

At first, BRIC was nothing more than an investment category - a label for fund managers looking at high-growth markets. The four countries had no formal relationship with each other. But the idea took on a political life of its own. By 2006, the foreign ministers of Brazil, Russia, India, and China began meeting on the sidelines of the UN General Assembly. By 2009, they held their first formal summit in Yekaterinburg, Russia.

In December 2010, South Africa was invited to join, and the acronym became BRICS. South Africa's inclusion was strategic: it gave the group a foothold on the African continent and signalled that BRICS was not just about economic size but about representing the developing world more broadly.

Together, the five original BRICS members account for roughly 3.25 billion people (over 40% of the world's population), approximately 27% of the world's land area, and a combined nominal GDP of around US$28 trillion. In purchasing power parity (PPP) terms, their share of global output is even larger - around 31%.

What began as an investment banker's acronym had become a diplomatic platform, and eventually a set of institutions challenging the post-World War II financial order.

Q: Who coined the term "BRIC" and in what year?

Jim O'Neill, an economist at Goldman Sachs, coined "BRIC" in his 2001 paper Building Better Global Economic BRICs. The term was originally an investment category before becoming a political alliance.

BRICS brings together five countries with very different economic models, political systems, and levels of development. Understanding these differences is essential because they explain both the bloc's potential and its internal tensions.

China is the dominant member by a wide margin. With a GDP exceeding US$18 trillion (nominal), China alone accounts for roughly 70% of BRICS' combined economic output. It is often called the "world's factory" because of its massive manufacturing sector, which produces everything from electronics to steel. China operates under a one-party system led by the Communist Party.

India has the largest population of any BRICS member (over 1.4 billion) and is the world's fastest-growing major economy. Its strength lies in services - particularly information technology, business process outsourcing, and software development. India is a parliamentary democracy with a federal structure.

Russia is a resource-rich economy heavily dependent on oil and natural gas exports. It possesses one of the world's largest nuclear arsenals and holds a permanent seat on the UN Security Council. Russia's political system is a federal republic, though governance has become increasingly centralised.

Brazil is Latin America's largest economy, powered by agriculture, mining, and natural resources. It is one of the world's top exporters of soybeans, beef, iron ore, and crude oil. Brazil is a federal presidential republic with a vibrant but sometimes turbulent democratic system.

South Africa is the smallest BRICS economy but serves as a gateway to the African continent. Its economy is built on mining (gold, platinum, diamonds), financial services, and manufacturing. South Africa is a constitutional democracy that emerged from apartheid in 1994.

The Five BRICS Founding Members - Economic Profiles

Q: Which BRICS member accounts for roughly 70% of the bloc's combined GDP?

China's GDP of roughly US$18.5 trillion makes it the dominant "super-member" of BRICS, accounting for about 70% of the group's combined economic output.

Given their vast differences in size, political systems, and economic models, what actually holds BRICS together? The answer lies in three shared interests that all five founding members agree on, despite disagreeing on much else.

First: Reform the global financial architecture. The existing international financial system - centred on the World Bank, the International Monetary Fund (IMF), and the US dollar - was designed after World War II primarily by the United States and Western Europe. BRICS members argue that this system no longer reflects the actual distribution of economic power in the world. China, for example, is the world's second-largest economy but has significantly less voting power in the IMF than its economic weight would suggest. All five BRICS countries want a larger voice in these institutions.

Second: Discourage power politics and hegemony. BRICS members share a preference for a multipolar world rather than one dominated by a single superpower. They oppose unilateral military interventions (such as NATO operations conducted without UN Security Council authorisation) and advocate for the principle of state sovereignty. While each member defines "multipolarity" differently, the basic idea - that no single country should dominate global affairs - is a unifying theme.

Third: Support economic modernisation in developing countries. BRICS sees itself as a voice for the Global South - the developing countries of Africa, Asia, and Latin America that feel underrepresented in existing global institutions. By creating new institutions like the New Development Bank, BRICS aims to provide development finance without the policy conditions that Western-led institutions typically attach to their loans.

These three interests do not mean BRICS members agree on everything. India and China have an unresolved border dispute. Russia and Brazil have very different views on climate policy. But the shared desire to reshape the global order provides enough common ground to keep the bloc functioning.

Q: Which of the following is NOT one of the three shared interests that bind BRICS members?

BRICS is not a military alliance. The three shared interests are: reforming global financial architecture, discouraging power politics and hegemony, and supporting economic modernisation in developing countries.

BRICS has held annual summits since 2009, evolving from informal meetings into structured events with formal declarations, action plans, and institutional deliverables.

The 1st summit took place in Yekaterinburg, Russia on 16 June 2009, just months after the 2008 global financial crisis. The timing was deliberate: the crisis had shaken confidence in Western-led financial institutions, and the four BRIC leaders saw an opportunity to demand a bigger voice in the IMF and World Bank. The summit's joint statement called for a "more democratic and just multipolar world order."

The 3rd summit in Sanya, China (2011) was the first to include South Africa, marking the transition from BRIC to BRICS. The 5th summit in Durban, South Africa (2013) launched the idea of a BRICS-led development bank.

The 6th summit in Fortaleza, Brazil (2014) was arguably the most consequential. It produced two landmark agreements: the New Development Bank (NDB) with US$50 billion in initial capital, and the Contingent Reserve Arrangement (CRA) with US$100 billion in committed resources. These institutions gave BRICS a concrete institutional identity beyond annual meetings.

Subsequent summits continued to expand the agenda. The 9th summit in Xiamen, China (2017) introduced the "BRICS Plus" concept - inviting non-member developing countries to participate in summit events. The 14th summit in 2022 was held virtually under China's presidency.

The 15th summit in Johannesburg (August 2023) was historic: it invited six new countries to join, though only four (Egypt, Ethiopia, Iran, and the UAE) formally joined on 1 January 2024. The 16th summit in Kazan, Russia (October 2024) further expanded the bloc by announcing 13 partner countries, including Turkey - the first NATO member to attend a BRICS summit.

From Acronym to Alliance - Key BRICS Milestones (2001-2024)

Q: What two landmark institutions were created at the 2014 Fortaleza summit?

The 6th BRICS summit in Fortaleza, Brazil (2014) established the New Development Bank (NDB) with US$50 billion in capital and the Contingent Reserve Arrangement (CRA) with US$100 billion in committed resources.

The New Development Bank (NDB) is the most concrete institutional achievement of BRICS. It was established in 2014 and began operations in 2016, headquartered in Shanghai, China.

The NDB was created with an initial subscribed capital of US$50 billion, shared equally among the five founding members (US$10 billion each). Its authorised capital is US$100 billion. This equal capital structure was deliberate - unlike the World Bank and IMF, where the United States and Europe hold outsized voting power, the NDB gives each founding member an equal vote. No single country has a veto.

The bank's mandate is to finance infrastructure and sustainable development projects in BRICS countries and other developing nations. By the end of 2023, the NDB had approved over 100 projects across its member countries, covering areas such as renewable energy, water management, urban transportation, and digital infrastructure.

A key difference from the World Bank and IMF is that the NDB does not impose policy conditions on its borrowers. Western-led institutions have historically required governments to adopt specific economic reforms (such as privatisation or spending cuts) in exchange for loans - a practice known as "conditionality" that many developing countries resent. The NDB lends without such strings attached.

The bank has also expanded its membership beyond the original five. Bangladesh, Egypt, the UAE, and Uruguay have joined as new members, broadening the NDB's reach and legitimacy. A distinctive feature is the NDB's push for local currency lending - issuing bonds and making loans in yuan, rand, and other local currencies rather than exclusively in US dollars. This reduces borrowers' exposure to dollar exchange rate fluctuations.

Q: What is the initial subscribed capital of the New Development Bank?

The NDB was established with an initial subscribed capital of US$50 billion, shared equally among the five founding members at US$10 billion each. The authorised capital is US$100 billion.

The NDB is the best-known BRICS institution, but it is not the only one. The bloc has built a broader institutional architecture designed to reduce dependence on Western-led systems and give developing countries more options.

The Contingent Reserve Arrangement (CRA) was established alongside the NDB in 2014, with total committed resources of US$100 billion. The CRA functions like a mutual insurance pool: if a BRICS member faces a sudden balance-of-payments crisis (a sharp fall in foreign currency reserves), it can draw on the CRA for emergency liquidity rather than going to the IMF. Contributions are weighted: China provides US$41 billion, Brazil, Russia, and India each provide US$18 billion, and South Africa provides US$5 billion.

BRICS has also been developing a cross-border payment system to reduce reliance on the US-dollar-dominated SWIFT network, which processes the vast majority of international financial transactions. After Western sanctions cut several Russian banks from SWIFT in 2022, the push for an alternative accelerated. While a fully operational BRICS payment system is still in development, bilateral currency swap agreements between BRICS members have increased significantly.

Beyond finance, BRICS has expanded cooperation into other areas. An anti-drug cooperation framework tackles transnational narcotics trafficking. Academic and cultural exchanges operate through the BRICS Network University and the BRICS Think Tanks Council. Business cooperation runs through the BRICS Business Forum.

BRICS promotes what scholars call a "coexistence strategy" - working within the existing global system while gradually building parallel institutions that offer developing countries alternatives. This is not an attempt to overthrow the current order, but to reshape it by making the system more multipolar. BRICS leaders often cite four principles: respect for sovereignty, non-interference in internal affairs, equality among nations, and mutual benefit.

Q: How much are the total committed resources of the Contingent Reserve Arrangement (CRA)?

The CRA was established with US$100 billion in total committed resources, with China providing the largest share at US$41 billion. It serves as a mutual insurance pool for BRICS members facing balance-of-payments crises.

One of the biggest questions surrounding BRICS is whether emerging economies can actually catch up with the developed West. Modernisation Theory says yes - it argues that all countries pass through similar stages of development, and that developing nations are simply earlier on the same path that Western countries have already travelled.

Under this view, catching up is not just possible but inevitable, provided developing countries adopt the right policies. The recipe includes opening up to trade and investment, importing technology and capital from advanced economies, and building modern institutions. Growth comes through comparative advantage - each country specialises in what it produces most efficiently - and through capital diffusion and technology transfer from rich to poor nations.

The BRICS story, at first glance, seems to support Modernisation Theory. China grew at an average of 10% per year for three decades. India's IT services sector turned the country into a global outsourcing hub. Brazil became one of the world's top agricultural exporters. These are textbook examples of developing countries leveraging their advantages in the global economy.

However, Modernisation Theory has been criticised for assuming that "modernisation" essentially means Westernisation - adopting Western economic models, institutions, and values. Critics point out that China's rise was driven not by following the Western playbook but by a distinctly different state-directed model. The theory also tends to treat developing countries as simply "undeveloped" rather than recognising that their challenges may be structurally different from what Western nations faced.

Q: According to Modernisation Theory, how do developing countries catch up with the West?

Modernisation Theory argues that developing countries catch up by opening to trade and investment, importing technology, and building modern institutions - essentially following the path Western nations took.

Dependency Theory offers a fundamentally different view. Rather than seeing openness to the global economy as the path to development, it argues that integration into the Western-led system perpetuates exploitation and keeps developing countries poor.

The core argument is that Western corporations and governments take advantage of developing countries' low labour costs and abundant natural resources. The globalisation of production may bring foreign capital into a country, but it also creates new forms of subordination, hierarchy, and dependency. Profits flow back to the developed world, technology remains controlled by multinational corporations, and developing countries get locked into producing low-value raw materials while importing expensive manufactured goods.

From this perspective, the idea that BRICS can converge with the West is an exaggeration. Most BRICS members remain dependent on the West for capital, technology, and access to markets. Russia boomed on oil exports but failed to diversify. Brazil exports soybeans and iron ore but imports advanced technology. Even China, despite its manufacturing dominance, depended heavily on Western consumer markets to drive its growth.

Dependency theorists would argue that rather than "developing," these countries are being "underdeveloped" - actively kept in a subordinate position by the structure of the global economy. The solution, in this view, is not more integration but structural change: building domestic industries, reducing reliance on foreign capital, and reforming the international institutions that enforce the current hierarchy.

Q: What does Dependency Theory argue about developing countries integrating into the global economy?

Dependency Theory argues that integration into the Western-led global economy perpetuates exploitation through low labour costs, resource extraction, and profit repatriation - keeping developing countries in a subordinate position.

The actual economic performance of BRICS members reveals a more complicated picture than either theory predicts. While China's growth has been extraordinary, the other members have faced persistent structural challenges.

In 2012-2013, growth rates varied dramatically: Brazil at 1.9%, Russia at 4%, India at 5.5%, and China at 7.8%. South Africa grew at just 2.4%. China was the clear engine of BRICS growth, but even China's model raised concerns - its development was built on its position as the "world's factory," and scholars warned that credit and property bubbles could trigger a future slowdown.

Russia illustrates the resource curse: its economy boomed on oil and gas, with energy accounting for roughly 63-68% of total export revenue. But the oil boom led to little diversification, leaving Russia vulnerable to price shocks and, later, Western sanctions.

Brazil faced a similar challenge with commodity dependence, while India's growth, though impressive, was concentrated in services and IT, leaving large parts of its agricultural and manufacturing sectors underdeveloped.

A key insight from the slides is that except for China, the BRICS economies were not substantial enough to truly challenge the established economic powers. And even China, with a population 24% larger than all high-income countries combined, had a per-capita income only one-fifth of theirs. The BRICS countries lacked the diverse, innovation-driven economies needed to compete in newer, more dynamic sectors - not just in traditional industries but in advanced technology, pharmaceuticals, and high-end services.

Q: What percentage of Russia's total export revenue comes from energy (oil and gas)?

Energy products (oil, gas, and coal) account for roughly 63-68% of Russia's total exports, making its economy highly vulnerable to price fluctuations and sanctions.

International trade is overwhelmingly conducted in US dollars. This gives the United States enormous economic power - the ability to impose sanctions, freeze assets, and control access to the global financial system. BRICS members, particularly Russia and China, have been pushing to change this.

The scale of dollar dominance is striking. Approximately 90-96% of Brazil's export invoicing is in dollars. In India, 86% of imports and exports are dollar-denominated - despite the US accounting for only about 10% of India's total trade. Even South Africa, which has taken steps toward the Chinese renminbi, remains heavily dollar-dependent.

De-dollarisation - reducing reliance on the US dollar in trade, reserves, and financial transactions - is a shared interest across all BRICS nations. Russia and China have led the charge, driven by geopolitical rivalry with the United States. Putin has called for BRICS to develop national currencies as a new global reserve alternative. India, Brazil, and South Africa have expressed support for creating more opportunities to use local currencies in international trade.

Concrete initiatives are underway. The NDB can finance projects in local currencies. Bilateral currency swap agreements have proliferated: India and Russia are trading in rupees and yuan; Russia and China trade in yuan and roubles; China and South Africa use yuan. These arrangements extend beyond BRICS too - Russia trades with Turkey in roubles, China with Iran in yuan, and India with Bhutan in rupees.

Dollar Dependency Across BRICS Members

Q: What percentage of India's trade is invoiced in US dollars, despite the US representing only about 10% of India's total trade?

About 86% of India's imports and exports are denominated in US dollars, even though the US accounts for only about 10% of India's total trade volume - illustrating the dollar's role as the dominant invoicing currency globally.

Despite the rhetoric, BRICS has found that breaking free from the dollar is far harder than declaring the intention. The US dollar remains entrenched in the global financial system for three powerful reasons.

First, the dollar is the dominant reserve currency. Central banks worldwide hold approximately 57% of their foreign exchange reserves in US dollars (down from 72% in 2001, but still far ahead of the euro at roughly 20%). Most BRICS members themselves hold large dollar reserves. Dumping these reserves quickly would crash the value of their own holdings.

Second, the dollar dominates trade invoicing. About 40% of global exports are invoiced in dollars - and in the Americas, the figure is 96%. Switching invoicing currencies requires both buyer and seller to agree, and both need access to functioning financial infrastructure in the alternative currency. This creates a massive coordination problem.

Third, the dollar dominates global financial infrastructure. The SWIFT messaging system, the US Treasury bond market, and the international banking system are all dollar-centric. Building alternatives from scratch takes years, if not decades.

The Chinese yuan, often suggested as the dollar's replacement, has its own problems. Beijing tightly manages the yuan's exchange rate, which limits its appeal as a freely tradeable reserve currency. The Indian rupee has limited attractiveness beyond South Asia. No single BRICS currency is ready to serve as a global alternative to the dollar.

The conclusion from the lecture slides is sobering: BRICS cannot make a complete break from the dollar-based financial system. What they can do is gradually reduce dependency through bilateral currency arrangements, local-currency lending via the NDB, and the CRA as a first line of defence before turning to the IMF.

Q: Which of the following is NOT a reason why de-dollarisation is difficult for BRICS?

BRICS members have NOT fully replaced the dollar - most still hold large dollar reserves and conduct the majority of trade in dollars. The difficulty of de-dollarisation stems from the dollar's dominance in reserves (~57%), trade invoicing (~40%), and financial infrastructure.

Beyond the dollar question, BRICS has consistently pushed for reforms in the institutions that govern the international order: the UN Security Council, the IMF, and the G20.

The UN Security Council has five permanent members with veto power - the United States, Russia, China, the United Kingdom, and France - a structure unchanged since 1945. BRICS argues this is outdated and unrepresentative. Brazil, India, Germany, and Japan have all pushed for permanent seats. Perhaps the most striking imbalance: Africa has no permanent representation on the Security Council, yet roughly 60% of Council deliberations address African issues and 70% of UN peacekeeping operations take place on the continent.

At the IMF, BRICS demands a reapportionment of voting shares. China's IMF voting power stands at roughly 6.4% - less than half of what the IMF's own quota formula would give it (13.7%), and far below China's 17-19% share of global GDP. BRICS members want to increase the voting shares of emerging economies, and they want to end the tradition of selecting a European to head the IMF and an American to head the World Bank.

The G20 is seen by BRICS as a more legitimate forum than the G7 because it includes major developing economies like Brazil, India, China, South Africa, and Indonesia alongside established powers. BRICS wants to strengthen the G20's role in global economic governance, making it a more effective decision-making body rather than a talking shop.

A quote from the slides captures the nuance of BRICS' position: "China and other emerging great powers do not want to contest the basic rules and principles of the liberal institutional order; they wish to gain more authority and leadership within it." BRICS seeks reform, not revolution.

Q: What is China's approximate share of IMF voting power versus its share of global GDP?

China holds only about 6.4% of IMF voting power despite contributing 17-19% of global GDP. Even the IMF's own formula would give China 13.7%. This mismatch is a central BRICS grievance.

International relations scholars use three main theoretical frameworks to analyse how countries behave on the world stage. Each framework highlights different aspects of China's BRICS strategy.

Realism focuses on power and self-interest. Realists see the world as a competitive arena where states pursue security and dominance. From this lens, China uses BRICS to increase its own power and influence - to gain major-power status in a world still shaped by American dominance.

Liberalism (or Liberal Institutionalism) focuses on institutions and cooperation. Liberals argue that international institutions - the UN, IMF, WTO - enable countries to cooperate for mutual benefit, even if they don't fully trust each other. From this lens, China uses BRICS to reform existing institutions and create new ones (NDB, AIIB) that give developing countries a stronger voice.

Constructivism focuses on ideas, identity, and norms. Constructivists argue that how countries see themselves and how others see them shapes their behaviour. From this lens, China uses BRICS to build a discourse - a narrative about developing countries' legitimate right to a bigger role in global governance - while managing the "China threat" perception that makes other countries nervous.

The lecture argues that all three lenses are needed to understand China's approach, but that realism dominates. China is ultimately pursuing major-power status and national interest. The liberal and constructivist approaches serve that goal by making China's rise look cooperative and legitimate rather than threatening.

Q: According to the lecture, which theoretical approach dominates China's BRICS policy?

The lecture concludes that realism dominates China's BRICS policy - China is ultimately pursuing major-power status and national interest. Liberal and constructivist approaches serve that primary goal.

To understand China's current BRICS strategy, you need to go back to Deng Xiaoping, who transformed China's foreign policy after taking power in 1978. Under Mao Zedong, China's foreign policy was shaped by revolutionary ideology - supporting communist movements worldwide and confronting both the US and the Soviet Union. Deng changed this fundamentally.

Deng argued that "peace and development are the most significant global issues of the present era." Globalisation was making progress; major-power wars were becoming less likely. China needed a peaceful international environment to focus on modernisation and economic development. Rather than confronting the world, China should join it - carefully.

Deng's famous strategic guidance, sometimes summarised as "hide your capabilities and bide your time", instructed Chinese leaders to keep a low profile internationally, avoid claiming leadership, and focus on building domestic economic strength. This was not passive - it was a deliberate strategy of patience. Grow strong first. Assert yourself later.

This doctrine shaped China's approach to BRICS from the beginning. Rather than directly confronting the United States, China positioned itself as a constructive member of the international community that simply wanted a fairer system. BRICS provided the perfect platform: it allowed China to advocate for institutional reform alongside other developing countries, sharing the spotlight rather than dominating it alone.

The post-Cold War power configuration, as Chinese strategists described it, was "one superpower and several major powers" (yichao duoqiang). China's goal was to gradually shift this toward a genuinely multipolar world - but without provoking a confrontation with the sole superpower.

Q: What was Deng Xiaoping's strategic guidance often summarised as?

Deng's strategic guidance was to "hide your capabilities and bide your time" - keep a low profile, avoid claiming leadership, focus on building economic strength domestically before asserting global influence.

The 2008-09 global financial crisis was a turning point for BRICS and for China's strategy within it. The crisis, which originated in the American financial system, cast serious doubt on the international financial architecture led by the United States.

The crisis weakened US global influence in several specific ways. It damaged the credibility of the American free-market capitalist model as a template for development. China's state-directed response - a massive stimulus package that kept the economy growing - was widely seen as faster and more effective than the West's response. The crisis also accelerated the relative power shift: China's economy was smaller than Japan's in 2008, but by the mid-2010s it was more than twice as large.

Institutionally, the crisis forced a recognition that the G7 alone could not manage the global economy. The G20 was elevated to the leaders' level, giving emerging economies like Brazil, India, and China a more prominent role. Zhou Xiaochuan, governor of the People's Bank of China, published an influential essay in 2009 calling for a new international reserve currency to replace the dollar - a direct challenge to American financial hegemony.

From the Chinese perspective, the crisis confirmed what realists had long argued: that US power was not permanent. American "unilateralism and arrogance," as the slides put it, had led to strategic overreach. The BRICs group was pushed to the centre of the international stage, and China saw an opportunity to assume a more important role in international governance mechanisms.

Chinese arguments in this period emphasised the promotion of multilateralism and multipolarity, positioning emerging economies at a more central role. The objective was a peaceful rise through these processes rather than directly confronting the United States. Emerging major powers should be perceived as "an opportunity, not war."

Q: How did the 2008 financial crisis affect BRICS' position in the global order?

The 2008 crisis damaged Western credibility, elevated the G20 (giving emerging economies more voice), and pushed BRICS to the centre of international governance - a turning point for the bloc.

From the realist perspective, China uses BRICS as part of a broader strategy to gain major-power status and influence in the international community. Two initiatives illustrate this most clearly: the Belt and Road Initiative (BRI) and the Asian Infrastructure Investment Bank (AIIB).

The Belt and Road Initiative (originally called "One Belt, One Road" or OBOR) was announced by President Xi Jinping in September-October 2013. It consists of two components: the Silk Road Economic Belt (overland routes through Central Asia to Europe) and the 21st Century Maritime Silk Road (sea routes through Southeast Asia to Africa and Europe). Through massive infrastructure investment - ports, railways, highways, pipelines, and digital networks - China aims to build economic corridors linking it to markets across Asia, Africa, and Europe.

The AIIB was proposed in October 2013 and became operational in January 2016 with 57 founding members and an authorised capital of US$100 billion. Today it has 111 members across all continents. Unlike the NDB (where each BRICS member has equal voting power), China holds the largest voting share in the AIIB - making it clearly a China-led institution.

Realists interpret both initiatives as strategic tools. The BRI extends China's economic influence across the developing world, creating dependency relationships where recipient countries owe Chinese banks and contractors. The AIIB gives China a platform to channel development finance on its own terms, bypassing the US-dominated World Bank. Together, they form the institutional architecture of China's bid for great-power status.

Q: When was the Belt and Road Initiative announced?

Xi Jinping announced the BRI in two speeches in September-October 2013: the "Silk Road Economic Belt" at Nazarbayev University in Kazakhstan, and the "21st Century Maritime Silk Road" at the Indonesian parliament.

While realism drives China's core objectives, the liberal/institutional approach explains how China pursues those goals through institutions and cooperation rather than confrontation.

China's institutional strategy has deep roots. In April 1974, Deng Xiaoping stood before the UN General Assembly and voiced China's support for the New International Economic Order (NIEO) - a Third World demand for fairer rules in trade, finance, and technology transfer. That same year, the UN General Assembly formally adopted the NIEO through two resolutions. The demand was radical at the time, but the spirit persists in China's BRICS policy today.

The Chinese argument, as the slides outline, is that the current international system is inadequate. The gap between rich and poor has widened. Existing institutions cannot effectively address global challenges like terrorism, environmental protection, and climate change. The international order lags behind the rising demands for global governance - it was designed for a world that no longer exists.

China's liberal strategy operates on two tracks. First, reform existing institutions: increase China's voting share in the World Bank and IMF, exploit the G20 as a governance platform, and push for more representative leadership appointments. Second, create new institutions: the NDB, the AIIB, and the CRA provide alternatives that do not require waiting for Western approval of reforms.

Crucially, the slides emphasise that BRICS has no desire to destroy the existing international order - it wants to maintain and reform it. China recognises the value of international NGOs, multilateral cooperation, and soft power. The liberal approach is about gaining influence within the system, not overthrowing it.

Q: What was the New International Economic Order (NIEO)?

The NIEO was formally adopted by the UN General Assembly in 1974 through two resolutions. It called for changes in trade, industrialisation, finance, and technology transfer - demands that echo in China's current BRICS policy.

The constructivist perspective focuses on something the other two theories often miss: the role of ideas, narratives, and perception in shaping international politics. For China, this means using BRICS to build a compelling story about why developing countries deserve more power in global governance.

BRICS wants to establish a discourse representing the interests of developing countries to strengthen the legitimacy of their demands. This is not just about economics or institutions - it is about shaping how the world thinks about fairness, representation, and the right to participate in global decision-making.

The constructivist strategy has several dimensions. China promotes the multipolarisation of international relations - the idea that a world with multiple power centres is more stable and just than one dominated by a single superpower. It calls for the democratisation of international relations - applying the principle of "one country, one vote" more broadly. And it advocates for equal dialogue with the developed Western countries - insisting that developing nations should be treated as genuine partners, not junior participants.

Perhaps most importantly, China uses BRICS to minimise the "China threat" perception. By acting through a multilateral group rather than alone, China can pursue its interests without appearing to be a unilateral aggressor. BRICS provides political cover: instead of "China demands more power," it becomes "developing countries deserve fairer representation."

The slides conclude that the liberal and constructivist approaches together serve a dual purpose: developing China's soft power, enhancing its international status, and containing the rise of nationalism domestically by showing Chinese citizens that their country is gaining respect on the world stage through peaceful means.

China's Three-Lens BRICS Strategy

Q: How does the constructivist approach explain China's use of BRICS?

The constructivist lens shows China using BRICS to build a discourse about developing countries' legitimate right to a bigger role, while acting through a multilateral group to reduce the perception that China alone is threatening the existing order.

Brazil did not rush into BRICS. When Jim O'Neill coined the term in 2001, Brazil's foreign policy establishment was more focused on international law, multilateral institutions, and UN reform than on joining an informal club of emerging economies. Brazilian diplomats were wary of being lumped together with countries whose political systems and strategic interests differed sharply from their own.

But the advantages quickly became apparent. BRICS gave Brazil a platform to pursue goals it could not achieve alone: UN Security Council reform (where Brazil competes with regional rivals Mexico and Argentina for a permanent seat), a louder voice in the G20 and WTO, and a counterweight to NATO members' influence in global security decisions.

A pivotal moment came in 2011, when all five BRICS countries simultaneously held seats on the UN Security Council. They coordinated to oppose what they saw as NATO's misuse of the Responsibility to Protect (R2P) principle in Libya - using a humanitarian mandate to pursue regime change against Muammar Qaddafi. For Brazil, this was exactly the kind of power politics that BRICS could help resist.

By the early 2010s, Brazil had moved from sceptic to enthusiast. BRICS was not just an acronym anymore - it was a diplomatic tool that amplified Brazil's voice in every major international forum.

Q: Why did Brazil's view of BRICS shift from scepticism to strategic engagement?

Brazil recognised that BRICS amplified its voice in international forums - particularly for UN Security Council reform, trade negotiations, and resisting Western-led interventions like the Libya operation.

BRICS membership brought tangible economic benefits to Brazil. By 2016, BRICS partners accounted for a significant share of Brazil's trade: roughly 23% of exports and 21% of imports. China quickly became Brazil's single largest trading partner, and in 2018, bilateral trade between China and Brazil hit a record US$100 billion - a milestone that would have seemed unimaginable a decade earlier.

The trade relationship is deeply complementary. Brazil exports what China needs: soybeans, iron ore, crude oil, and other raw materials. China exports what Brazil buys: electronics, machinery, and manufactured goods. Brazil also became one of the largest recipients of Chinese infrastructure investment in Latin America, with Chinese companies funding ports, railways, power plants, and telecommunications networks.

Beyond trade, BRICS cooperation extended into security. The bloc distinguishes between two categories: traditional security (military threats and conflicts) and non-traditional security (cybersecurity, terrorism, drug trafficking). Brazil worked with BRICS partners on energy security and counter-terrorism, areas where cooperation could deliver results without the political costs of military alliances.

This combination of trade growth and security cooperation made BRICS a practical asset for Brazil, not just a diplomatic talking shop.

Q: What was the record value of bilateral trade between China and Brazil in 2018?

China-Brazil bilateral trade hit a record US$100 billion in 2018, making China Brazil's largest trading partner. The relationship is complementary: Brazil exports raw materials (soybeans, iron ore) while China exports manufactured goods.

One of Brazil's biggest wins through BRICS came in the reform of international financial institutions. The IMF quota reform, completed in 2015, reclassified Brazil, China, India, and Russia among the ten largest IMF members. Brazil's voting power increased from approximately 1.4% to 2.22%, moving it into the top ten shareholders of the institution.

But Brazil's crowning BRICS achievement came at the 6th BRICS Summit in Fortaleza, Brazil, in July 2014. This was the summit where two landmark institutions were formally established: the New Development Bank (NDB) with US$50 billion in initial capital, and the Contingent Reserve Arrangement (CRA) with US$100 billion in committed reserves.

For Brazil, hosting this summit was a matter of national pride. The country had moved from being a recipient of IMF bailouts in the 1990s and early 2000s to being a co-founder of an alternative development bank. The NDB was headquartered in Shanghai, but it opened regional offices in Sao Paulo and Brasilia - a recognition of Brazil's importance within the institution.

Brazil received four early NDB loans totalling US$621 million, directed at renewable energy, infrastructure, and urban development projects. The NDB also committed to lending in local currencies - Brazilian reais rather than US dollars - reducing exchange rate risk for borrowers and symbolically challenging dollar dominance in development finance.

Brazil's BRICS Institutional Wins - From IMF Reform to NDB Co-Founder

Q: What two institutions were formally established at the 2014 Fortaleza Summit hosted by Brazil?

The 2014 Fortaleza Summit was Brazil's crowning BRICS achievement, formally establishing the NDB (US$50B capital) and the CRA (US$100B reserves) - the two flagship BRICS institutions.

Brazil's BRICS engagement hit a wall after 2013. The country entered a multidimensional crisis: a prolonged economic recession, a public security emergency, a bitter clash between conservative and leftist ideologies, and the massive Lava Jato (Car Wash) corruption scandal that brought down President Dilma Rousseff through impeachment in 2016.

When Jair Bolsonaro won the presidency in October 2018, Brazil's foreign policy made a sharp U-turn. Dubbed the "tropical Trump" by international media, Bolsonaro pursued aggressive alignment with the United States and actively distanced Brazil from its Global South partners.

The policy shifts were dramatic. Brazil withdrew from the Global Compact for Migration in January 2019. It refused to host COP25 (the UN climate conference was eventually held in Madrid, Spain). Bolsonaro disregarded the Paris Agreement and adopted a business-first approach to developing the Amazon region - a stark reversal from Brazil's hosting of the landmark Earth Summit in 1992 and Rio+20 in 2012.

The pro-US tilt went further. Brazil agreed to a strategic partnership with the US in space exploration, supported regime change in Venezuela (aligning with Washington against Beijing and Moscow), granted visa-free status to US tourists, and in July 2019 was designated a "major non-NATO ally" by President Trump - a status that provides privileged access to US defence technology and military cooperation.

Q: Which of the following best describes Bolsonaro's foreign policy approach?

Bolsonaro made a sharp U-turn in Brazilian foreign policy, pursuing aggressive alignment with the United States - including major non-NATO ally status, visa-free entry for US tourists, and supporting US positions on Venezuela - while actively distancing Brazil from its Global South partners.

Bolsonaro's presidency created direct friction with China, Brazil's largest trading partner. Rising Sinophobia in Bolsonaro's political circle produced provocative statements. The president himself declared: "the Chinese may buy in Brazil, but they may not buy Brazil" - a warning against excessive Chinese economic influence.

Yet the economic reality forced pragmatism. Even as political rhetoric turned hostile, trade with China continued to grow. When the US-China trade war escalated, Brazil actually benefited as Chinese buyers shifted soybean purchases from American to Brazilian suppliers. The contradiction between anti-China politics and pro-China economics defined the Bolsonaro years.

The damage to BRICS went beyond bilateral tensions. Bolsonaro sought US support for Brazil's entry into the OECD (the club of wealthy democracies), which would have pulled Brazil further into the Western institutional orbit and away from South-South cooperation. His government sided with Washington on Venezuela, supporting opposition leader Juan Guaido - directly colliding with China and Russia, who backed President Maduro.

Bolsonaro's foreign policy team advanced a civilisational argument: that Brazil, unlike China, Russia, or even India, was fundamentally a Western power - "securely and nearly inevitably allied with the United States and Western Europe." This framing questioned the very premise of BRICS as a coalition of like-minded nations from the Global South.

The result was stagnation in intra-BRICS relations. Brazil did not withdraw from BRICS, but its engagement became minimal. The tension between Brazil's Western identity and its BRICS membership had never been more visible.

Q: What was the main contradiction in Bolsonaro's approach to China?

The central contradiction of the Bolsonaro years was that anti-China rhetoric and growing Sinophobia existed alongside continued trade growth - Brazil actually benefited from the US-China trade war as Chinese buyers shifted soybean purchases from American to Brazilian suppliers.

The pendulum swung back in January 2023 when Luiz Inacio Lula da Silva returned to the presidency. Lula - who had presided over Brazil's most active BRICS engagement during his first presidency (2003-2010) - immediately signalled a return to Global South diplomacy.

Brazil rejoined the Global Compact for Migration, re-engaged with the Paris Agreement, and restored relations with China and Russia. Lula attended the 2023 Johannesburg Summit, where he supported the historic expansion of BRICS to include Egypt, Ethiopia, Iran, and the UAE.

In 2025, Brazil assumed the rotating BRICS presidency, hosting the 17th BRICS Summit in Rio de Janeiro. The Rio Summit reflected Brazil's diplomatic style: emphasis on inclusive governance and institutional development rather than anti-Western confrontation. Key outcomes included a proposed BRICS investment guarantee institution (modelled on the World Bank's MIGA) and continued work on payment system alternatives.

Yet the return was not without complications. The Rio Declaration made no mention of de-dollarisation - a notable omission given years of rhetoric. Brazil walks a tightrope: using BRICS to amplify its Global South leadership while avoiding direct confrontation with the West, maintaining trade relationships with both China and the United States, and balancing its identity as both a BRICS founding member and an aspiring OECD candidate.

Brazil's BRICS story illustrates a broader truth: in the emerging multipolar world, strategic ambiguity - keeping options open across blocs - may be more valuable than firm alignment with any single camp.

Q: What notable omission characterised the 2025 Rio BRICS Summit Declaration?

Despite years of rhetoric about reducing dollar dependence, the 2025 Rio Declaration made no mention of de-dollarisation - reflecting Brazil's preference for inclusive governance and institutional development over direct confrontation with the Western financial order.

On 1 January 2024, BRICS underwent its most dramatic transformation since South Africa joined in 2010. Four new countries became full members: Egypt, Ethiopia, Iran, and the United Arab Emirates. The invitation had been extended at the 15th BRICS Summit in Johannesburg in August 2023, where six countries were originally invited - but Argentina withdrew after President Javier Milei, elected in November 2023, reversed the previous government's acceptance.

Saudi Arabia presented a more complex case. Despite being formally invited, it neither accepted nor declined - adopting a wait-and-see posture. Crown Prince Mohammed bin Salman was notably absent from the Kazan Summit family photo in October 2024. As of early 2025, Saudi officials described themselves as "still assessing" membership.

Then came another landmark: Indonesia was elevated to full membership on 6 January 2025, announced during Brazil's presidency. Indonesia became the 10th full member and the first Southeast Asian nation in BRICS, bringing the bloc's combined population to roughly half the world's total.

The expansion transformed BRICS from a club of five emerging economies into something more ambitious: a potential platform for the Global South as a whole. But it also introduced new complexities - the UAE and Iran, for instance, are regional rivals, and the expanded membership made consensus harder to achieve.

Q: Why did Argentina not join BRICS despite being invited at the 2023 Johannesburg Summit?

Argentina was invited at the Johannesburg Summit, but newly elected President Javier Milei - a libertarian who favours alignment with the US - reversed the previous government's acceptance of the BRICS invitation.

The 16th BRICS Summit in Kazan, Russia (October 2024) introduced a major institutional innovation: the partner country category. This new tier sits below full membership and provides a structured pathway for expansion without the consensus costs of admitting new full members.

Nine nations were formally confirmed as partner countries: Belarus, Bolivia, Cuba, Kazakhstan, Malaysia, Nigeria, Thailand, Uganda, Uzbekistan, and Vietnam. Several other invitees, notably Algeria and Turkey, did not confirm their partner status.

The model mirrors the Shanghai Cooperation Organisation's observer state process - countries prove themselves as partners before graduating to full membership. The distinction matters:

BRICS Membership Tiers - Full Members vs Partner Countries (2025)

Q: What is the key difference between BRICS full members and partner countries?

The critical distinction is decision-making power. Full members participate in consensus-based decision-making with voting rights and can drive BRICS-wide initiatives. Partner countries have no voting rights and participate in meetings by invitation only.

Perhaps no BRICS ambition has attracted more attention - and more scepticism - than de-dollarisation. The idea of reducing dependence on the US dollar in international trade and reserves has been a summit talking point for years. But how much progress has actually been made?

BRICS Pay, introduced at the Kazan Summit in October 2024, is a decentralised payment messaging system designed as an alternative to SWIFT. Developed by researchers at Saint Petersburg State University, a prototype was demonstrated in Moscow in October 2024. China fully backed the initiative. But as of mid-2025, it remains in early pilot stages with no timeline for broad deployment.

A more advanced initiative is mBridge (Multiple CBDC Bridge) - a platform for cross-border payments using central bank digital currencies (CBDCs). Jointly developed by the central banks of Hong Kong, Thailand, UAE, and China, plus the Bank for International Settlements (BIS), mBridge reached minimum viable product (MVP) stage in mid-2024. But in a telling move, the BIS reportedly considered withdrawing from the project after the Kazan Summit discussed building a "BRICS Bridge" based on mBridge technology.

The reality check came at the 2025 Rio Summit. The declaration made no mention of de-dollarisation. Finance ministers were asked to continue evaluating "the utilisation of national currencies, payment tools, and platforms" - but no binding timeline was set. Intra-BRICS trade is still largely conducted in US dollars.

The core obstacle remains the same one identified in Module 2: the dollar's dominance in reserves (~57%), trade invoicing (~40%), and financial infrastructure makes it extraordinarily difficult to replace, even among countries that say they want to.

Q: What is the current status of BRICS Pay as of mid-2025?

A BRICS Pay prototype was demonstrated in Moscow in October 2024 and China backed the initiative, but as of mid-2025 it remains in early pilot stages with no timeline for broad deployment - illustrating the gap between de-dollarisation rhetoric and operational reality.

A decade after its founding at Fortaleza, the New Development Bank has grown significantly - but also faces mounting challenges. By 2024, total project approvals reached approximately US$40 billion across 122 initiatives, with around US$22.4 billion disbursed. The bank raised US$16.1 billion in bond issuances in 2024 alone.

The NDB has expanded far beyond its five founding members. As of 2025, it has 11 member countries: the original BRICS five plus Bangladesh (2021), UAE (2021), Egypt (2023), Algeria (2025), Colombia (2025), and Uzbekistan (2025). Indonesia announced plans to join in March 2025.

Under President Dilma Rousseff (Brazil's former president), the NDB has focused on four investment pillars: logistics infrastructure, digital transformation, social infrastructure, and energy transition. It holds a AAA credit rating from the Japanese agency JCR and has expanded into yen-denominated instruments and Middle East capital markets.

But the NDB faces challenges that mirror the broader tensions within BRICS. Western sanctions on Russia have complicated the bank's ability to lend to one of its founding members. The bank's local-currency lending ambitions - a core part of the de-dollarisation narrative - have been slower to materialise than hoped. And despite its growth, the NDB's total lending remains a fraction of what the World Bank disburses annually.

The NDB's real significance may be less about competing with the World Bank and more about demonstrating that emerging economies can build credible financial institutions on their own terms - even if those institutions operate within, rather than outside, the existing financial system.

Q: How many member countries does the NDB currently have beyond the original five BRICS founders?

The NDB has expanded to 11 members: the original 5 BRICS founders plus Bangladesh, UAE, Egypt, Algeria, Colombia, and Uzbekistan - demonstrating that the institution has attracted interest well beyond its founding membership.

BRICS has always been a coalition of very different countries. But as the bloc expands, the internal tensions are becoming harder to manage.

The deepest fault line runs between India and China. Despite a partial disengagement agreement at the Kazan Summit in 2024, their decades-old border dispute along the Line of Actual Control remains unresolved in substance. India's simultaneous membership in the Quad (a US-led grouping that includes Japan and Australia, aimed partly at countering Chinese influence in the Indo-Pacific) creates a fundamental strategic contradiction with BRICS solidarity.

Then there is the China dominance problem. China's GDP in purchasing power parity terms is larger than all other BRICS members combined - roughly 52% of the BRICS+ total. Most intra-BRICS trade is China-centric: bilateral trade between non-China BRICS members is extremely low. This creates a paradox: BRICS members want to reduce dependence on the US-led system, but risk replacing it with dependence on China.

Russia views BRICS primarily as an anti-Western alliance - a tool to circumvent the sanctions imposed after the Ukraine invasion. But India, Brazil, and South Africa resist this framing. They pursue "strategic autonomy" - cooperating with BRICS without burning bridges to the West. The 2025 Rio Summit confirmed this tension: the declaration was carefully calibrated to avoid anti-Western confrontation.

The expansion itself introduces new fault lines. Iran and the UAE are regional rivals. Egypt and Ethiopia are locked in a dispute over the Grand Ethiopian Renaissance Dam. Even the partner country list contains uncomfortable pairings.

Critics point to a fundamental structural weakness: BRICS has no binding treaty obligations, no permanent secretariat with enforcement power, and no dispute resolution mechanism. It relies on consensus - which becomes harder to achieve with every new member.

Q: Why does India's Quad membership create a strategic contradiction with BRICS?

India's Quad membership (with the US, Japan, and Australia) is aimed partly at countering Chinese influence in the Indo-Pacific - creating a fundamental strategic contradiction with BRICS, where China is a founding member and the dominant economic power.

Where is BRICS heading? The answer depends on which forces prevail: the economic gravity pulling emerging economies together, or the political tensions pulling them apart. Here are three plausible scenarios for BRICS by 2030.

Scenario 1: Coordination Platform (Most Likely)

BRICS continues as a loose coordination forum for Global South countries. It holds annual summits that produce aspirational declarations but few binding commitments. The NDB grows modestly. De-dollarisation remains incremental. BRICS is useful for articulating shared grievances about IMF voting rights, climate finance, and UN reform - but does not produce viable institutional alternatives to the Western-led order. The partner country tier expands, giving BRICS a wider footprint without deeper integration.

Scenario 2: Institutional Deepening (Possible)

A breakthrough on the BRICS payment system creates a functioning alternative to SWIFT for bilateral trade settlement. The NDB doubles its lending portfolio and begins competing meaningfully with regional development banks. A permanent BRICS secretariat is established to coordinate policy between summits. The partner-to-member pathway produces 2-3 new full members. BRICS becomes a genuine institutional counterweight to the G7 - not replacing it, but creating a parallel track in global governance.

Scenario 3: Fragmentation (Possible)

Internal tensions overwhelm shared interests. An escalation in the India-China border dispute, a confrontation between Iran and the UAE, or a new Russia-related crisis forces members to choose sides. The consensus model breaks down. Key members (India or Brazil) quietly disengage. BRICS becomes a Chinese-Russian diplomatic vehicle that most of the Global South avoids. The NDB stagnates due to sanctions complications and credit rating pressures.

The most likely path is Scenario 1 - BRICS as a permanent feature of the international landscape but not the revolutionary force its champions imagine or its critics fear. The bloc's real achievement may be changing the conversation: making it impossible for Western institutions to ignore the demand for reform from the Global South.

Q: According to the analysis, which scenario is considered most likely for BRICS by 2030?

The most likely scenario is BRICS continuing as a loose coordination platform - useful for articulating Global South grievances about IMF reform, climate finance, and UN reform, but unlikely to produce viable institutional alternatives to the Western-led order in the near term.