Brics Summit 2024: The Bloc With New Global Currency
Asia
Business
On 22/10/2024, the 16th BRICS Summit was held in the Russian City of Kazan for a 3-day event to discuss emerging geopolitical issues and investments among its members. Having been established in the year 2009 under the umbrella of Brazil, Russia, India, and China, the bloc continues growing and attracting more attention from all over the world. Since its establishment, other countries have joined the BRICS, starting with South Africa (2010), Iran, Egypt, the United Arab Emirates, and Ethiopia. Many other countries seek to join in this new development of a group of emerging economies. Argentina, Cuba, the Democratic Republic of Congo (DRC), Malaysia, Turkey, Venezuela, and Gabon have expressed their interest in BRICS. This year's 16th BRICs summit is seeing the attendance of influential global leaders Russia’s President Vladimir Putin, China’s President Xi Jinping, and United Nations Chief, Antonio Guterres. Antonio Guterres's attendance evidences the influence of the BRICs Summit on global geopolitics and economy as the bloc represents half of the world’s population. The last summit t was held in South Africa in 2023. The major talking points of the BRICS Summit 2024 are centred on economic cooperation among the member states. The need to open the business corridors and collaborations among the members has been highly emphasized. Climate is also a major topic of discussion as the world grapples with the adverse climate changes. The global uncertainties due to the existing conflicts have also been highlighted especially in the Middle East and the need to ensure no spill-over of the conflict to the entire Middle East Region. The Western sanctions on some of the member states such as Russia and China have also been raised for discussion during the summit. The summit noted that there is a need to remove such unlawful sanctions and bans that hamper peace and the growth of international trade. The BRICS summit has pointed out the necessity of changing the global payment system. Members have agreed to work towards revolutionizing the global payment system. The BRICS member countries are to introduce and adopt a new payment system known as the Brics Pay, a blockchain-based payment platform. A new currency is also being set up to compete with the US Dollar, which will be used as a transactional currency among the BRICS member states. The BRICs have set up a new development bank that will serve member countries that require funding for their infrastructural projects. There has been an emphasis on financial innovation among the member states through the BRICS Interbank Cooperation Mechanism (ICM). The BRICS members account for about 40% of the world’s population Gross Domestic Product (GDP) and Purchasing Power Parity (PPP). This means they are the new block with a huge influence on global geopolitics and economics. They now pose a challenge to the advanced and developed economies in the West. It challenges the G7 economies consisting of Germany, Italy, Japan, France, Canada, the United Kingdom, and the United States of America. The European Union is also a non-enumerated member of G7. The G7 controls 30% of the global economy, falling short by more than 10% of the BRICS global economy control. The BRICS summit reflects the shift in global power dominance. The International Monetary Fund (IMF) forecasts the growth of BRICS, with China taking center stage. It also points to a decline in the G7's power and dominance in geopolitics and the global economy.
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