The BRICS: from investment club to geopolitical weapon

Beatrice E. Rangel

By: Beatrice E. Rangel - 12/09/2023

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When Jim O'Neill, at the time, chief economist of the investment bank Goldman Sachs, coined the term BRIC (Brazil, Russia, India China), he was thinking of facilitating the understanding of the drivers of change in the global economy by bankers. , economists and those interested in finance. For him it was important to identify these new and growing drivers of global growth in order to develop policies that would promote their consolidation as emerging economies and the entry and use of the institutional framework created after 1945. He was far from thinking that the category would be used as political weapon to weaken the United States.

But Russia saw there its opportunity to create a coalition of dupes to begin to challenge the United States and China for world leadership. Russian diplomacy was fully mobilized to create conditioning economic ties with the members of the bloc that was formed as a club of nations in 2009. Russian fertilizers displaced the Americans and Europeans and penetrated Brazilian agriculture. For India, the conquest package was of an energy and technological nature, as Russia became the main supplier of fossil fuels and India became the main supplier of engineering services to Russia. With China there was parsimony because that nation is very clear about the world geopolitical map and Russia may be a temporary ally but it will always be a rival in Central Asia. The entry of South Africa opened a new door to Vladimir Putin's geopolitical design. And with the passage of time the economic matrix designed by those who intend to rebuild the Russian empire. It served to create bonds of dependency with all members of the club except China.

The vagaries of the slow global economic recovery after the 2008 financial crisis and COVID 19, as well as the political changes within the coalition, slowed Putin's impetus. In Brazil, Jair Bolsonaro rose to power, whose antipathy for anything that smacks of communism is notorious. In South Africa, the pro-Russian Jacob Zuma was succeeded by Cyril Ramaphosa, a union leader turned successful businessman. In India, Mammoham Singh, a prominent thinker, internationalist, academic and development economist close to Western power circles, gave way to Narendra Modi, a factionalist politician with deep nationalist sentiment and supporter of making India not only a power but a country where Hinduism prevails r In China, XI Ji Ping was on the rise, whose vision of China does not give rise to substitute leadership.

Putin's plan had to be slowed down. But for 20021, with the invasion of Ukraine just around the corner, it had to be relaunched. And Lula came to power in Brazil who, like every good Latin American, blames his mistakes on the United States and will therefore do what he can to weaken that country. The Putin plan found the ideal godfather.

It is now about using the BRICS to weaken the United States by replacing the dollar with any other international reserve currency, or better yet, with a cryptocurrency that no one regulates or knows how or who issues it. The sworn enemies of the United States, such as Venezuela, are being invited to the club via Lula, others will soon come such as North Korea, Cuba, Myanmar and the bloody dictatorships of Africa.

In summary, the category created to promote the development of a group of economies that represent 40% of the world's gross product has become, by the design of a Russian autocrat and with the collaboration of the president of Brazil, an instrument to weaken the United States without repair. that are weakening the country that is part of the lifeblood of domestic growth and that facilitates the commercial transactions that allow all those countries except Russia to access the digital economy in a massive and democratic way. To see the boomerang effect that this Russian initiative could have, just travel to Bangalore and look at the academic and professional credentials of Indian technology entrepreneurs. They have all studied in the United States and completed internships at Silicon Valley companies. In the case of South Africa, the most significant direct private investment comes from England, France, Holland and the United States. Brazil would be well below the growth level it is at today if Nicholas Brady had not restructured its debt in the early 1990s. Today the second largest direct private investor is the United States after the Netherlands.

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