China and BRICS Challenge the West
BRICS is a China-led association of countries from the Global South that aspire to develop their economies and reduce the influence of more prosperous Western countries.
By Laurence F. Sanford
China dominates BRICS, an association comprising Brazil, Russia, India, China, and South Africa that seeks to challenge Western financial and trading institutions. It openly states a desire to replace the U.S. dollar as the world’s reserve currency.
BRICS was organized in 2010 to reduce U.S. economic influence worldwide and to develop alternative payment methods to the U.S. dollar. It has since added Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates as members. China is the dominant member, with a GDP roughly equivalent to the sum of all other members’ combined.
At the BRICS summit held in Rio de Janeiro, Brazil, on July 6-7, President Lula da Silva of Brazil, Prime Minister Modi of India, and President Cyril Ramaphosa of South Africa were in attendance.
President Xi of China was notably absent; instead, Premier Li Qiang represented China. Xi reportedly skipped the meeting due to mounting economic woes, military leadership issues, and a major political leadership meeting. Other theories regarding Xi’s absence include possible medical problems, his displeasure with Brazil’s decision not to join the Belt and Road Initiative, and unhappiness with Brazil’s first lady who, at a Beijing banquet, criticized TikTok for being detrimental to children.
President Putin of Russia was absent due to an International Criminal Court (ICC) arrest warrant, issued for the unlawful deportation of Ukrainian children in the ongoing Russian invasion of Ukraine. Putin did appear in a virtual call to celebrate de-dollarization in trade among member nations. Putin is looking for BRICS nations to help Russia avoid Western sanctions and aid in his war with Ukraine.
Without the support of China, Putin would not be able to conduct the war against Ukraine effectively. Chinese industrial supplies are integral to Russian military equipment, including missiles and drones. Many industrial supplies are dual-purpose and used in both military and civilian equipment.
In 2022, China purchased over $88 billion in Russian oil at discounted prices. The oil reaches China through a combination of Arctic and Indian Ocean shipping routes, utilizing “dark or shadow fleet” ships that operate without tracking transponders, as well as pipelines. China avoids Western sanctions because the oil is processed through small local Chinese refineries that are immune to Western sanctions.
Brazil issued positions on climate change, artificial intelligence, and poverty in countries of the Global South. Additionally, President Trump’s tariffs were criticized for violating World Trade Organization (WTO) rules and causing disruptions to the global supply chain. The U.S. attack on fellow BRICS member Iran was criticized.
Brazilian President Lula denounced the “genocide” of Israel attacking Gaza, but made no mention of Hamas initiating the war, killing over 1,200 Israelis, and committing atrocities. Lula also met with Dilma Rousseff, president of the New Development Bank, to celebrate the progress of the BRICS bank in providing financial aid to Global South countries.
The New Development Bank (NDB) was established by BRICS in 2015 to mobilize resources for development projects in emerging markets and developing countries. NDB is headquartered in Shanghai, China. Rousseff, Brazil’s former president, was impeached in 2016 for corruption and forced to leave office. She previously served three years in jail for far-left subversion.
Summary
BRICS is a China-led association of countries from the Global South that aspire to develop their economies and reduce the influence of more prosperous Western countries, led by the US. Left unspoken is China’s goal to replace the U.S. as the world’s dominant power.
Not all BRICS countries are united. India has serious issues with China on territorial claims, military buildup, and economic rivalry. India banned TikTok for subverting Indian culture.
President Trump has threatened tariffs against BRICS countries that undermine the U.S. dollar as the world’s reserve currency and create an alternative currency. Trade between China and Russia bypasses the U.S. dollar and uses the Chinese renminbi currency, with the basic unit of the yuan. The renminbi is not widely used due to its limited convertibility compared to the dollar. Chinese purchases of Russian oil fund the Russian military budget. Cryptocurrencies and AI may change how trade payments are made in the not-too-distant future.
BRICS is here to stay in one form or another. It is perfectly natural for nations to cooperate to further their economic and political interests. The issue is in defining these interests.
The industrial nations of the world, led by the U.S., formed the Group of 7 (G7), a seven-nation Western intergovernmental forum organized around shared values of liberal democracy. The Group of 20 (G20) includes sovereign countries, the European Union, and the African Union. It works to address the global economy, financial stability, and development.
Action
- More trade and less aid. Empowering free market trade leads to prosperity and freedom. Aid channeled through government and NGOs often leads to corruption and reduced freedoms.
- Expand the G7 and G20 international forums to include more countries from the Global South.
- Expose China for its state-controlled, mercantilist policies that harm the economies of Global South countries.
- Recognize that China is waging unrestricted warfare against the United States.
Laurence F. Sanford is a senior analyst at the American Security Council Foundation.
