Protection against the storm
Written by Pablo González and Pedro Nonay, trying to find what we can do in our adaptation to changes in world order.
Relevant context.
BRICS+ Summit
October 27, 2024
I clarify that this is not one of my usual “entries”, but a shorter text to comment on something that I see of special relevance.
The BRICS 2024 summit was held in Kazan (Russia) from October 22 to 24.
The news has had some coverage in the Western media, but much less than an event of such importance should have. This is due to the West’s desire to silence the advances and demonstrations of strength of the group of countries with which it will have to share world hegemony.
The fact is that countries representing 46% of the world’s population and a third of the planet’s GDP (not irrelevant) have come together. Even Antonio Guterres, Secretary General of the UN, attended. It is interesting to see the photo of the link I provide below in which you can see the bow that Mr. Guterres makes to Putin in the greeting. It seems to say that the UN is willing to accept what they are asking for (at least in part).
The attending countries are not a homogeneous group in their situations and objectives. They are homogeneous in what unites them the most, which is the will to take power away from the USA in the control of supranational organizations, as well as from the dollar in its leading role in world trade and finance.
In that sense, the summit has been a show of strength and a message to the world that Putin is not alone behind the sanctions over the invasion of Ukraine.
There is a good summary of what happened at this link.
Possible consequences.
As I have said, I believe that the summit is a staging of the need for changes in the world order, and of the group that wants to promote them. The changes will not be made at the summit, but they are encouraged from there.
Here are some possible consequences that I can think of:
- The first consequence is already a fact: global bipolarism is established.
- Negotiation of changes will begin after the US elections.
I think it is important to highlight the date of the summit, which is two weeks before the US elections. I think that this proximity should be taken into account when looking at the content of the approved declaration, which, in my opinion, is as if they had made a list of their objectives and wishes (not of specific measures approved). It seems that the addressee of this “letter” is the new US government. It is as if they were saying: “This is what we are looking for. When we know who our interlocutor is, we will start negotiations (or fights)”. And, admittedly, their list of targets is not insane.
- They deliver Venezuela to the West.
An important decision has been made outside the text of the declaration. It is the non-admission of Venezuela as a member. I interpret it as a first gesture of good will for future negotiations with the West. They send the message that they support Putin, but not Maduro. You can see the news here. They embellish it by saying that it was Brazil’s decision, but I find it hard to believe that Brazil would do that without the support of the rest. I see this news as a first “world pact” accepting Venezuela to change its bloc (and forcing the change of government).
- They show the tools of pressure to force negotiations.
It is quite logical for any group to want to expose its aspirations. But, if it does not demonstrate the need for the dominant group to count on it, it will achieve nothing.
In this case, the BRICS lobbying tools before the West are basically:
- Its strong control of raw materials for renewable energies, as well as a significant weight in conventional energies.
- Their ability to hurt the dollar if they avoid using it in payments between BRICS bloc countries.
- Their ability to destabilize geopolitics and international trade. Wars are an example.
- Its strong control of raw materials for renewable energies, as well as a significant weight in conventional energies.
- The Bretton Woods institutions and other supranational organizations will change.
They will use their lobbying tools to force those changes. In the statement they say very clearly what they are looking for:
- Point 11, where they expressly call for the reform of the Bretton Woods institutions. Logically, claiming greater weight in them.
- Point 3, where they insist that the BRICS seek a more representative international order and a reformed multilateral system.
- Point 8, where they expressly call for the reform of the UN and its Security Council to give greater weight to the BRICS countries.
- Point 62, where they support the work of the New Development Bank to finance infrastructure in member countries. This institution is intended to be a counterweight to the World Bank.
- Point 11, where they expressly call for the reform of the Bretton Woods institutions. Logically, claiming greater weight in them.
- They will seek to expand the number of countries in their group.
In point 5 of the declaration, they speak of expanding the group of BRICS countries, and create the modality of associated country.
- Encourage the use of local currency for payments between member countries.
They say so in points 65 and 66 of the declaration. It is a way of disassociating themselves from the dollar, and hurting it.
They do not say anything specific about the creation of a common BRICS currency, but we know that it is something they are studying, although we also know that it is difficult for them to reach agreements on it. Even so, they have in tests what they have called BRICS PAY (you can see it here).
- Intra-BRICS trade institutions will be created.
They announce this in point 73, where they welcome the Russian initiative to create the “BRICS Grain Exchange”, as well as expanding it to other agricultural sectors.
- They will fight against international sanctions that do not have their support.
- Point 10, where they complain about the sanctions they call unilateral and illegal. They do not expressly cite Russia, but it is clear that they are referring to it, and are giving it indirect support.
- Point 83, where they oppose the acceptance of “unilateral and protectionist” measures under the pretext of environmental protection.
- Point 10, where they complain about the sanctions they call unilateral and illegal. They do not expressly cite Russia, but it is clear that they are referring to it, and are giving it indirect support.
The full summit declaration can be viewed here. Be patient, though, because it is long and with convoluted diplomatic language.
On the other hand, for anyone interested in comparing this summit with last year’s, I set out my views on the matter in this note of mine dated October 1, 2023.
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As always, I welcome comments on my email: pgonzalez@ie3.org