Brics, initially conceived two decades ago as a forumof rapidly developing economies comprising Brazil, Russia, India, China and South Africa, has undergone significant evolution, transcending its original purpose. It is no longer merely a coalition of emerging-market voices. It has transformed into a more ambitious political and economic entity.
Brics is frequently regarded as a Chinese-led counterweight to US and Western European dominance, particularly within institutions such as the IMF, the World Bank and the UN. Following its recent expansion, which includes the admission of new members such as Egypt, Ethiopia, Iran and the UAE in 2024 and Indonesia in January 2025, with Saudi Arabia on the verge of joining, the bloc now represents approximately 46 per cent of the global population and 35-40 per cent of global economic output.
Despite its expanding influence and economic significance, Brics is grappling with internal divisions. The recent 17th Brics summit held in Rio de Janeiro fostered some unity concerning shared global challenges but also revealed profound disagreements on geopolitical matters, trade policies and technology governance. Brics leaders reiterated demands for multipolar global governance and institutional reform, particularly within the UNSCl and international financial structures. Brazil’s finance minister, Fernando Haddad, emphasised the necessity for enhanced representation and equity for Global South members, cautioning that global governance remains disproportionately skewed in favour of affluent northern nations.
In a similar vein, the group urged wealthier nations to adequately fund climate transition initiatives in developing economies, endorsing Brazil’s proposed Tropical Forests Forever Facility with investments from China and the UAE. These policy commitments showed Brazil’s developmental agenda and Brics’ ambition to articulate a vision for sustainable growth within the Global South. However, the bloc’s political cohesion faced challenges on contentious issues such as the conflict in Gaza.
Brics issued a collective appeal for a two-state solution while condemning violence. Nevertheless, Iran – already set to join in 2024 – expressed its reservations through diplomatic channels but refrained from vetoing the joint statement. A notable diplomatic signal reflecting these tensions was the reported absence of Saudi Arabia’s foreign minister, Faisal bin Farhan, from the political discussions. As a principal military ally of the US, Riyadh continues to navigate interests between Western and Brics affiliations, illustrating the complexities new members face in balancing their alliances.
Perhaps most indicative of the bloc’s current dynamics were the absences of Chinese President Xi Jinping and Russian President Vladimir Putin, who are pivotal figures in Brics’ ideological framework. Xi missed the summit for the first time in his 12-year presidency, delegating authority to Premier Li Qiang. Speculation arose that a diplomatic slight, specifically Brazilian First Lady Janja Lula’s public criticism of TikTok during a recent visit to Beijing, may have provoked dissent within Xi’s delegation.
Meanwhile, Putin participated via video link; he utilised the forum to denounce “liberal globalisation” as outdated, asserting that China and other emerging markets represent the future, while reaffirming commitments to utilise national currencies in intra-Brics trade. These prominent absences diminished some of the political impact of the summit and raised pertinent questions regarding Brics’ unity in the face of challenges.
Nonetheless, the group achieved a significant milestone in releasing a joint declaration, a noteworthy accomplishment considering its diverse and rapidly expanding membership, especially following an unsuccessful attempt at consensus earlier in the spring. The expansion to include countries such as Iran and Saudi Arabia has unveiled significant ideological, governance and security divides. Iran’s inclusion poses a fundamental challenge, as its stance on Israel conflicts with the collective call for a two-state solution. Meanwhile, Saudi Arabia’s hesitance in formalising its membership and the foreign minister’s absence from political sessions signal a cautious approach.
Historical rivalries also endure, as exemplified by India’s caution regarding China’s regional influence, particularly in light of ongoing border tensions. The Indian government has been reluctant to endorse initiatives that might undermine its strategic autonomy or adversely affect its domestic interests. Differences relating to UNSC representation, where Brazil and India vie for permanent seats while African members advocate for broader reforms, further complicate the bloc’s internal cohesion.
Despite existing divisions regarding Middle East diplomacy, the members of Brics have demonstrated notable unity on economic matters, particularly in their critique of unilateral tariff measures implemented by the US. The summit declaration articulated “serious concerns regarding the rise of unilateral tariff measures”, reflecting previous grievances regarding erratic trade sanctions during Trump’s presidency.
Although the statement refrained from directly naming him, the intended target was unmistakable: Trump’s unpredictable trade wars inflicted disruptions on global supply chains and contributed to market instability. In response, Trump issued a pointed reaction via social media: “Any country aligning itself with the Anti-American policies of Brics will incur an ADDITIONAL 10 per cent tariff. There will be no exceptions to this policy”. This statement followed earlier threats indicating that the US would impose unilateral tariffs unless trade agreements were secured by August 1, a warning directed at both allies and adversaries.
This confrontation shows a deeper systemic tension: Brics aims to cultivate a multipolar trade environment less vulnerable to US economic coercion, while the US seeks to maintain its global influence by controlling economic access. A pertinent question arises: will the considerable economic strength of Brics currently bolstered by nearly $28 trillion in combined nominal GDP, representing over a quarter of global output and exceeding this figure in purchasing power parity (PPP) be sufficient to offset the financial power exercised through the US dollar?
Within the Brics framework, China distinctly assumes a predominant economic role, accounting for over 60 per cent of the bloc’s combined PPP GDP. This influence is manifested through various strategic initiatives, including the Belt and Road Initiative, the internationalisation of the yuan, financing for digital infrastructure and initial steps towards establishing a Brics-wide digital currency platform. China’s expansion efforts are seen as a validation of its model for a new multipolar world and an alternative international order.
At the Rio summit, China’s strategic posture was particularly evident in two key domains. First, Beijing endorsed calls for equitable governance regarding artificial intelligence, advocating against the dominance of Western technocrats. The summit declaration emphasised that AI regulation should be ‘inclusive’ and should not be restricted to affluent nations. In response to the preeminence of US technology firms in the AI space, China is significantly increasing its investment in domestic AI development to bridge the gap.
Second, China announced preliminary commitments with the UAE and Brazil to invest in environmental conservation initiatives, including Brazil’s Tropical Forests Forever Facility. This effort is part of Beijing’s strategy to enhance its soft power by positioning itself as a responsible global participant while fostering collaboration with partners from the Global South.
Brics is also actively exploring concrete economic tools. The New Development Bank, established in 2014 with an initial capital of $50 billion, plays a central role in financing infrastructure and sustainable development projects within member countries. Intra-Brics trade reached $614.8 billion in 2022, showing a significant increase from prior years. Such expansion is perceived as an opportunity to deepen financial cooperation, which includes enhancing swap lines, increasing lending capacity, and promoting the cross-border utilisation of local currencies, strategies designed to mitigate reliance on the US dollar.
President Putin’s emphasis on national currencies during the video address at the Rio summit reaffirms the aspiration among Brics members to strengthen mutual dependence and effectively navigate trade or financial sanctions. However, substantial challenges remain, including administrative hurdles, liquidity issues and resistance from certain factions within the Global South, raising doubts about the viability of these mechanisms in fully challenging the dollar-centric trade system.
Through the promotion of local currency usage, the fortification of the New Development Bank, and the potential establishment of a unified payment system, Brics could gradually challenge the prevailing dollar-centric economic order. Given that Brics countries accounted for 53.5 per cent of global GDP growth from 2014 to 2024 and are projected to represent nearly 40 per cent of world GDP in 2024, their economic significance is considerable. Nonetheless, systemic logistics, banking norms, and entrenched financial dynamics suggest that transitions will unfold incrementally.
The 2025 Brics summit highlighted the emergence of a significant geopolitical entity capable of transforming global trade and governance frameworks. They represent nearly half of the global population and wield substantial economic influence. To effectively navigate US pressures and adjust trade dynamics, Brics must focus on fostering internal trust and cohesion, developing infrastructure for local currency trade, enhancing the New Development Bank’s lending capacity and establishing critical standards in areas such as artificial intelligence and climate finance.
This involves creating bilateral and multilateral initiatives that can safeguard member states against potential U.S. punitive measures. While US resistance is anticipated through tariffs and sanctions, it is likely to offer trade agreements and strategic assistance to influence nations like Saudi Arabia and Brazil. Engagement in discussions on climate finance or AI within the Brics framework may also be pursued to mitigate external pressures.
Brics’ effectiveness will depend not only on economic indicators but also on strategic patience and the ability to act collectively. If successful in translating its ambitions into concrete actions, Brics could reshape trade dynamics and influence the architecture of global governance.
The writer is a trade facilitation expert, working with the federal government of Pakistan.