by Mustafizur Rahman :

Victoria Panova, who is head of BRICS Expert Council-Russia, tells Mustafizur Rahman about the philosophy and journey of the grouping in an interview with New Age

New Age: Russia initiated BRIC initially as an alliance of Brazil, Russia, India and China, formed in 2006. South Africa joined the group later, making it BRICS. How do you evaluate the journey as many more nations have by the time joined the organisation?

Victoria Panova: Let me start with the fact that BRICS is not an organisation in its formal sense. It now has official establishment documents, charter or secretariat. This is a new type of mechanism, the way a club functions, that allows informal, open and comprehensive exchange of ideas between the leaders, a flexible and fast achievement and implementation of commitments taken, the construction of all-out horizontal ties not only within the official track, but also with all different parts of society — civil society, business, academia or youth, etc.

I should say that it definitely grew into something much bigger than it was initially seen. While even today, some experts try to say that this is primarily an economic entity, it is clearly seen that the scope of issues offered for consideration and where BRICS does have a global influence is much wider. BRICS has become a comprehensive grouping, based on three main pillars — politics and global governance; economics and finance; and humanitarian ties and people-to-people contacts. It is nowadays recognised that the grouping has power and what is even more important is the authority to think and offer for consideration the new model of international relations, as the old developed, ‘geriatric’ powers and the system sponsored by them has clearly failed more and more over the past decades. Today, more than 40 countries have in different ways asked to join BRICS. It is rightly seen not just an alternative to the existing world order but also a group that does not dominate and dictate, but is able to lead by their own example and to offer a new model of mutually beneficial and forward-looking relations, without hidden agenda and based on trust and mutual respect, supporting principles of multi-lateralism and multiculturalism, with the equality of all civilisations, of all countries and their all peoples. And this alternative offered is not about revolution and not about countering the west. It is simply non-west, global east and south, world majority. But what is key is that it does not hint at any confrontation and rather looks into ways of evolution and progress to fit interests of all the stakeholders. And all this poses stark contrast with what the western countries are trying to impose — negative agenda; cancelling and trying to destroy those who are not fitting in with the narrow frames offered for others by western judges; thinking of their somehow divine right for ultimate truth, changing rules as they see fit best for themselves on the go and discarding international law; seeing blackmailing and pressure as the only way of how relations between the ‘flourishing garden’ and ‘wild jungles’ could be constructed. BRICS represents something absolutely opposite — positive agenda, directed at what can be done for common benefit; search for compromise and common ground and preserving culture of dialogues; ability and desire to elaborate new forms and institutes contributing to global development.

One can name numerous initiatives and projects already launched within BRICS that are making the international system more fair, more responsive to the needs of the countries of the world majority. The most well-known case is definitely the BRICS New Development Bank, offering new options to boost investment opportunities for critically important infrastructural projects in member countries, allocating financing free of politicisation and bias. But the New Development Bank is not the only one. BRICS countries have vast activities alongside the adopted STI architecture — gradually advancing to create BRICS Network University, showing progress alongside the plans of the BRICS Economic Partnership Strategy, deepening work on the premises of the energy research platform, contributing to the general cause of just energy transition in line with the interests and needs of developing countries, continuing to search for solutions to issues of global food security progressing with the agricultural platform and launching the BRICS Grain initiative this year and many many more ideas and projects implemented.

Do you as an expert think that the group of emerging economies has more influence on international politics than before, especially in the global financial system as expected?

LET us start first with what kind of changes we have been witnessing over the past three decades while the political power continued to be usurped by the collective west, economic power balance has shifted more and more vividly to the countries of Asia, Africa and Latin America. Today, China comes as number one powerhouse economically while the first, second and fourth places in this list is also taken by BRICS countries. BRICS altogether occupies more than 30 per cent of global landmass, twice as much as with the G7 countries, contains more than 45 per cent of the global population, four times that of the G7, and its GDP by PPP has already reached a historic 35.7 per cent this year. Although Goldman Sachs was forecasting a few years ago that by 2032, BRICS would surpass the G7 cumulative gross domestic product, today what we see is that this has already become a fact of life, even before the actual enlargement took place. The original five have already surpassed the cumulative gross domestic product of the G7 countries.

What else do we have here? About 45 per cent of global oil reserves are centred in BRICS countries and oil remains the blood of economic production. Industrial capacity is a vital aspect of a country’s development capacity, even during the current digital age. Various estimates also show that from 68–79 per cent of rare earth metals are also possessed by BRICS countries and it is common knowledge that they are indispensable elements of high-tech production. Talking about food security, it is also noticeable that BRICS countries are leaders both in production and consumption of grain, with both figures accounting for about 44 per cent. Once again, there could be a long list of all the figures along different sectors and types of resources where BRICS parameters are seen as undoubted leadership.

At the same time, political leadership are still mostly retained within the west. Institutes existing in the paradigm of what was once the Bretton Woods system continue to be dominated by the west. Needed reforms are blocked. The World Trade Organisation continues to be paralysed as it no longer supports only developments that are beneficial for advanced economies despite all their failures in preventing or managing international financial crises that the International Monetary Fund continues to stall on further quota reform while the leadership positions of both the International Monetary Fund and the world Bank remain under the control of ‘traditional’ European and American candidates.

Similarly, the UN Security Council has only two BRICS members in its ranks, with absolutely excessive presence from Europe, which has by far lost its influence globally but still seems to be living in the realms of the Euro-centric world.

While western powers are not eager to give up on their dominant position and would like to continue enjoying benefits of the past glory, emerging and developing economies with their significantly grown weight and consciousness are not eager to continue playing the subordinate role. Thus, we see further growing attractiveness of non-western entities — BRICS, SCO, ASEAN or others. We could also witness self-consciousness and independent position of the global south with the series of G20 presidencies of Indonesia, India and Brazil, with the current one transferred to South Africa. It is true to say that what saved this format from vanishing in such turbulent geopolitical times is the firm and consistent policies of the presiding countries.

Western nations dominate international financial bodies such as the International Monetary Fund and the World Bank. Is there any change in the system, with China emerging as a major economy coming up with more development projects in African/Asian countries?

INDEED, major international financial institutions such as the International Monetary Fund or the World Bank continue to be dominated by the west and real reform to make them more responsive to the needs of the developing world is far from any foreseen reality. One of the reasons BRICS went ahead rather speedily with the establishment of the BRICS NDB is exactly this crustiness and the lack of desire on part of the west to share its powers in accordance with today’s changed realities. While there still lies a road ahead for NDB perfection, specifically regarding its financing capacities and using the US dollar as major investment currency — although immediate plans include the use of no less of 30 per cent of national currencies and issuance of such sovereign bonds — at the same time, NDB offers more opportunities for such an area as infrastructure investment.

Another such initiative recently proposed is the one of the BRICS investment platform. It is meant to maximise the potential of emerging economies. It would allow BRICS countries, and also its partners, to use the advantage of the new wave of global economic growth. The proposal has been pronounced amidst the need to intensify the intra-BRICS dialogue in fields such as technology, education, trade, logistics, the rational use of resources, finance and insurance. As a means of reliable and secure investments, this platform would boost multilateral cooperation in respective areas. Further details concerning the platform are yet to be discussed at the expert level.

The idea to create BRICS investment platform didn’t appear out of the blue. BRICS gradually ramps up its global financial influence. BRICS’ outward FDI stock mushroomed from $1.1 trillion in 2011 to $3.7 trillion in 2021, an increase of 235 per cent. BRICS has become one of the most important players on the international investment market and initiatives such as a common investment platform will help to solidify the BRICS position and further strengthen the group’s financial might.

Also as rightly noted, many rising powers are also arriving with more options for the world to ensure that more opportunities exist. One of such options could be China’s Belt and Road Initiative, another is the Asian Infrastructure Investment Bank. More initiatives of the kind could be traced to a large-scale initiative from Russia on Greater Eurasian Space but also with the work led as part of efforts within the Eurasian Economic Union as well as the Eurasian Development Bank.

Those countries are very much interested in ensuring stable and prosperous neighbourhood, meaning that they are arrangements that could be beneficial for all those involved, not just offering a one-sided approach.

But what is more is that BRICS is not coming up with the zero sum game proposals. BRICS philosophy is about maximum available choice, with one criterion being solid in stone — no demands are given to choose between different actors. Being a partner in BRICS and its member is definitely not a barrier to have equally beneficial relations with anybody else ready for cooperation, be it the west or any other region, country or entity.

Is there any progress in the creation of a BRICS currency to reduce dominance of dollar across the globe?

I should say that there has not so far been any discussion of the kind to introduce a BRICS currency. What was discussed from the start was an alternative BRICS payment system. An important mechanism of coordination within BRICS was created in 2010 — the Mechanism of Interbank Cooperation — while four years later, BRICS countries arrived at signing a national currencies framework agreement, which was meant to stimulate the use of national money in BRICS economic exchange.

This year, a new analysis on BRICS cross-border payment initiative has also been prepared while at the Kazan summit, we could see the Russian initiatives on the creation of BRICS Clear and BRICS (Re)Insurance. All such instruments are to lower transaction costs and risks when we talk of mutual settlements in national currencies, but they are yet to be operationalised within the next year financial track. Definitely, one of prospective ways to go ahead with financial settlement system would be the use of digital currencies.

Bangladesh applied for BRICS membership in 2023. Do you have any idea of its present status? How could the country benefit if it becomes a member of the group?

As you know, more then 40 countries altogether applied to join BRICS in different forms and BRICS definitely very much adheres to principles of inclusivity and is seen as a core of the world majority. Each application is extremely important and, definitely, it is a great honour for BRICS to be the most attractive alternative in this turbulent world. But honour brings along responsibility. It is no less important that BRICS nowadays has responsibility in the face of that very world majority not to fail its mission of offering that new, fair, equally beneficial and sustainable world order. There are certain publicly proclaimed criteria that are necessary for the country to become a member or a partner. But, what is even more important to understand is that the membership of the grouping is not just about benefits. Definitely, deeper and more qualitative intra-BRICS cooperation offers benefits across the whole number of areas, but membership is not just what you get. It is also what you are ready to give, give for the common good. BRICS membership is a two-way street. It is not about donor-recipient relations and that is how equality and mutual respect are kept intact. The primary question to ask is what the country is willing to contribute to ensure a faster formation of a better world for all.

Does BRICS have the capacity to challenge wealthier counties of North America and Western Europe in the present context?

I believe that I have already given the answer to this question earlier in this interview. BRICS today has grown substantially and its countries now represent serious forces worldwide in economics and finance, in politics and security, in development, technology and innovation and in science and education. But that said, it is not envisioning itself as a countering force neither to North America nor to Europe. As we keep saying — we are non-west, but not anti-west. Rather we should say that BRICS and the countries going along with it could be following an independent path of their own development and their preferred model of international relations and cooperation based on trust, equity, equality, fairness and common interest. If the west is eager to go the same way, we are happy to go the same way. Otherwise, it is their own choice. But, we will follow ours. If you call the ability to follow your path is a capacity to challenge, you can describe it that way. But for me, BRICS is about positive leadership and constructive engagement. A win-win situation is always better than zero sum. No one comes as a real winner in the latter case.

Dr Victoria Panova is also vice-rector of the HSE University. Mustafizur Rahman is the chief of correspondents at New Age.