Trade between BRICS countries shows marked increase, Pg7

Key Highlights:

• The 18th BRICS Summit, chaired by India, is scheduled for September 12-13, 2026, in New Delhi, with a focus on reducing global dependence on the U.S. dollar.
• The BRICS bloc has expanded to include 10 member countries: Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the UAE.
• In 2024, merchandise exports by BRICS countries collectively accounted for approximately one-fourth of all global exports.
• Intra-BRICS trade has significantly increased, with most members, excluding China, receiving over 30% of their imports from other member nations in 2024.
• Russia's chairmanship in 2024 saw strong advocacy against the dominance of the U.S. dollar, following its exclusion from SWIFT in 2022 due to sanctions.

18th BRICS Summit.jpg

Detailed Insights:

• Finance ministries and central bank governors of BRICS nations met in August to discuss facilitating cross-border payments and strengthening national currencies.
• The expansion of BRICS aims to bolster trade and diplomatic relations among countries within the Global South.
• Current international payment systems often involve multiple correspondent banks and currency conversions, leading to costs and delays.
• Iran and Ethiopia exhibit high intra-BRICS import dependency, at over 65% and nearly 45% respectively.
• Export dependency within the bloc has also risen, with five members doubling or quadrupling their exports to other BRICS nations over the last decade.
• China maintains the lowest dependency on intra-BRICS exports due to its highly diversified global export market.
• Russia's export dependency within BRICS surged between 2020 and 2023, partly driven by increased fuel imports by countries like India amidst the invasion of Ukraine.
• The collective economic strength of BRICS, with China, India, and Russia among the top 10 global economies by Gross Domestic Product, positions the bloc to challenge dollar dominance.

Key Concepts Involved:

• BRICS: An intergovernmental organization of emerging economies aiming to foster cooperation and development among its member states.
• Global South: A term referring to a group of developing and emerging countries, primarily in Asia, Africa, and Latin America, sharing common developmental and historical concerns.
• SWIFT: The Society for Worldwide Interbank Financial Telecommunication, a secure messaging network used by financial institutions globally to exchange information and instructions for cross-border transactions.
• Correspondent banks: Financial institutions that provide banking services to other banks, typically in different countries, to facilitate international payments and currency exchange.