21 January 2014, 19:06

BRICS: economic or political Union?

BRICS: economic or political Union?
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The BRICS block is gaining stature in the international arena despite doubts about its viability. Once united by similar economic trends, the BRICS countries are now moving from an economic to a political agenda. And regular BRICS summits as well as the meetings among the heads of states on the sidelines of major international forums, are yet more evidence of their assertiveness in international politics. And though their economic growth – seen as a driver of economic recovery in the post-2008 world – has slowed, Brazil, Russia, India, China and South Africa are as close as never before. Georgy Toloraya, the executive director of Russia’s BRICS National Research Committee, and Charles Robertson, global chief economist with Renaissance Capital shared their vies on BRICS with the Voice of Russia.

International activity of BRICS is becoming more and more coordinated. And in 2013 for example, the five states demonstrated a unified position on Syria, saying that a peaceful settlement of the conflict was essential. Georgy Toloraya believes:

BRICS is widely perceived as being a sort of economic union which it is not, and it’s been especially clear when the BRICS economies are slowing down and in fact it is bringing them together, and the range of problems which BRICS addresses - political security and global governance issues - are high and high on the agenda. For example in St Petersburg they discussed many political issues – Syria and others, and I this is a tendency which will develop in the future. I think the BRICS will widen its scope of activities and address more and more issues. And I don’t even exclude that the number of BRICS countries might be enlarged.

The most likely candidate is Indonesia, which, as many experts say, will be a Muslim addition to the BRICS. At the same time Egypt last year expressed its desire to join the block transforming it into E-BRICS. In 2013 the BRICS states also demonstrated firm determination to establish their own Development Bank. And some details have already been inked. So the 6th BRICS summit in Brazil might make more progress on the issue. Charles Robertson said:

The BRICS Development Bank is going to be a slow moving beast I expect. I think the most interesting thing continues to be the idea of a currency intervention fund. The possibility of an intervention fund which could help reduce the volatility of currencies – that is a potentially market moving, and could be a big deal, if the BRICS summit actually makes progress on it.

But the BRICS countries already have a number of institutions and initiatives that strengthen their ties - the BRICS Business Council and the $100 billion Contingency Reserve Arrangement. They have simplified visa regimes and work on several joint projects such as the BRICS cable which is in its final phase of implementation.

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