[News] The Rise of the Global South: Can BRICS Triumph Over the IMF and World Bank?

[Anti-Imperialist News]

mintpressnews.com
<https://www.mintpressnews.com/e-rise-south-can-brics-weaken-dominance-imf-world-bank/284416/>
The Rise of the Global South: Can BRICS Triumph Over the IMF and World Bank?
April 17, 2023 - Ramzy Baroud
<https://www.mintpressnews.com/author/ramzy-baroud/>
------------------------------

Who would have expected that the BRICS nations could rise
<https://thefinancialexpress.com.bd/views/g7-and-brics-in-the-emerging-world-order-1657983387>
as the potential rival of the G7 countries, the World Bank and the IMF
combined? But that once seemingly distant possibility now has real
prospects which could change the political equilibrium of world politics.

BRICS is an acronym for Brazil, Russia, India, China and South Africa. It
was supposedly coined
<https://www.goldmansachs.com/our-firm/history/moments/2001-brics.html> by
the Chief Economist of Goldman Sachs in 2001 as a reference to the world’s
emerging economies. It was then known as BRIC, with the ‘S’ added later
when South Africa formally joined the group in 2010.

BRIC’s first official summit took
<http://www.brics.utoronto.ca/docs/090616-leaders.html> place in 2009.
Then, the discussion seemed largely abstract. However, not until 2014 did
BRICS begin taking serious steps towards greater integration, when the
nascent alliance, now including South Africa, launched
<https://www.ndb.int/about-ndb/history/> the New Development Bank with seed
money of $50 billion. This decision meant that the group was now ready to
take its first practical steps in challenging the dominance of the West
over international monetary institutions, namely the World Bank and the IMF.

The geopolitical global conflict, thus shifts, resulting from the
Russia-Ukraine war, however, proved to be the driving force behind the
massive expansion underway at BRICS, especially as financially powerful
countries began showing interest in the initiative. They include Argentina,
UAE, Mexico, Algeria and, particularly, Saudi Arabia.

Recent financial reports
<https://news.bitcoin.com/asean-countries-take-steps-to-reduce-reliance-on-us-dollar-for-trade-settlements/>
suggest that BRICS is already the world’s largest gross domestic product
(GDP) bloc in the world, as it currently contributes 31.5% to the global
GDP, ahead of the G7, which contributes 30.7%.

One of the greatest opportunities and challenges facing BRICS now is its
ability to expand its membership base while maintaining its current growth.
The issue of helping new members maintain economic and political
independence is particularly vital.

The IMF and World Bank are notorious
<https://www.leftvoice.org/in-ghana-an-important-movement-is-forming-against-the-imf/>
for stipulating their monetary support of countries, especially in the
Global South, on political conditions. This position is often justified
under the guise of human rights and democracy, though is entirely related
to privatization and opening markets for foreign investors – read Western
corporations.

As BRICS strengthens, it will have the potential to help poorer countries
without pushing a self-serving political agenda or indirectly manipulating
and controlling local economies.

As inflation is hitting many Western countries, resulting in slower
economic growth and causing social unrest, nations in the Global South are
using this as an opportunity to develop their own economic alternative.
This means that groups like BRICS will cease being exclusively economic
institutions. The struggle is now very political.

For decades, the US’s greatest weapon has been its dollar which, with time,
ceased being a normal currency per se to become an actual commodity. Wars
have been fought to ensure countries like Iraq
<https://www.rferl.org/a/1095057.html> and Libya remain committed to the
dollar. Following the US invasion of Iraq in March 2003, Baghdad returned
to selling its oil in US dollars. This struggle over the dominance of the
dollar was also painfully felt
<https://www.ibanet.org/article/5584F623-6456-4287-8C34-1907B97F3C23> in
Venezuela, which has the world’s largest
<https://www.worldometers.info/oil/venezuela-oil/> oil reserve, yet was
reduced to abject poverty for attempting to challenge the supremacy of
Washington its currency.

Though it will take time, the process of lessening the reliance on US
dollars is now in full swing.

On March 30, Brazil and China announced
<https://www.foxbusiness.com/markets/brazil-china-strike-trade-deal-agreement-ditch-us-dollar>
a trade agreement that would allow them to use the two countries’ national
currencies, the yuan and the reais, respectively. This step shall prove
consequential, for it will encourage other South American countries to
follow suit. But that move was neither the first nor will it be the last of
its kind.

One of the main decisions
<https://news.bitcoin.com/asean-countries-take-steps-to-reduce-reliance-on-us-dollar-for-trade-settlements/>
by finance ministers and central bank governors of the Association of
Southeast Asian Nations (ASEAN) following their March 30-31 meeting in
Indonesia is to reduce their reliance on the US dollar. They agree to
“reinforce financial resilience … through the use of local currency to
support cross-border trade and investment in the ASEAN region.” This, too,
is a game-changer.

The BRICS countries, in particular, are leading the charge
<https://www.news.com.au/finance/markets/world-markets/brazil-china-ditch-us-dollar-for-trade-payments-favour-yuan/news-story/682a517c37ba14f306e65ad0e83f6307>
and are set to serve as the facilitator of rearranging the world’s economic
and financial map.

While the West is busy trying to keep its own economies afloat, it remains
wary of the changes underway in the Global South. Washington and other
Western capitals are worried. They ought to be.

Following a meeting
<https://www.washingtonpost.com/politics/2022/12/12/biden-africa-ukraine-coalition/>
between US President Joe Biden and 40 African leaders at the White House
last December, it was clear that African countries were not interested in
taking sides in the ongoing war in Ukraine. Consequently, US Vice President
Kamala Harris flew
<https://www.brookings.edu/blog/africa-in-focus/2023/03/30/vp-kamala-harris-visit-to-africa-delivering-on-us-commitments-or-countering-china-and-russia/>
to Africa on March 26 to meet African leaders with the sole purpose of
pushing them away from China and Russia. That effort is likely to fail.

A perfect illustration of Africa’s refusal to abandon its neutrality is the
press conference between Harris and the President of Ghana, Nana
Akufo-Addo, on March 28. “There may be an obsession in America about
Chinese activity on the continent, but there is no such obsession here,”
Akufo-Addo told
<https://www.washingtonpost.com/politics/2023/03/27/harris-ghana-africa/>
reporters.

To argue that BRICS is a purely economic group is to ignore a large part of
the story. The timing of BRICS’ expansion, the stern political discourse of
its members, potential members and allies, the repeated visits by top
Russian and Chinese diplomats to Africa and other regions in the Global
South, etc., indicate that BRICS has become the South’s new platform for
geopolitics, economy and diplomacy.

The more successful BRICS becomes the weaker Western hegemony over the
South will grow. Though some Western politicians and media insist on
downplaying BRICS’ role in shaping the new world order, the change seems to
be real and irreversible.

*Dr. Ramzy Baroud is a journalist, author and the Editor of The Palestine
Chronicle. He is the author of six books. His latest book, co-edited with
Ilan Pappé, is ‘**Our Vision for Liberation*
<https://www.amazon.com/Our-Vision-Liberation-Palestinian-Intellectuals/dp/1949762440>*:
Engaged Palestinian Leaders and Intellectuals Speak Out’. His other books
include ‘My Father was a Freedom Fighter’ and ‘The Last Earth’. Baroud is a
Non-resident Senior Research Fellow at the Center for Islam and Global
Affairs (CIGA). His website is** www.ramzybaroud.net*
<http://www.ramzybaroud.net/>

The views expressed in this article are the author’s own and do not
necessarily reflect MintPress News editorial policy.

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