What is the BRICS Group?

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Wednesday - 4 April 2018 - 1:49 PM


At the beginning of the past decade, Brazil, Russia, India and China, with large


domestic markets and growing economies, stood out from the rest.


A phonetically suitable acronym – BRIC – was then created with their



initials as a promotional element of a portfolio with risky investments. Because


of the stability of their political framework and their continued economic growth,


already in the mid-2000s, an opportunity surfaced to explore the possibility of


joint action between these countries in major international forums of global






The original idea was to create a politically cohesive group as a counterbalance


to the major international players – the US and the EU. The first meetings date


back to 2008 and the formalisation of the group as a new voice on


the international stage took place in 2009, with the Summit of the Heads of State


and Government in Yekaterinburg, Russia. In 2011 South Africa’s entry was


formalised, thereby completing the BRICS acronym.



Starting in 2008, meetings between ministers of different areas and senior


government officials multiplied,Providing substance to a broad international


agenda which included not only Group of Twenty (G-20), but also



Other international forums related to trade and the environment.



The BRICS is an association formed by countries in four continents: Brazil in


the Americas, Russia in Europe, India and China in Asia and South Africa


in Africa. Its member states cover an area of over 39,000,000 square kilometers,


which is approximately 27% of the world's land surface.




The Heads of Governments of these States meet annually in a number of


forums and on the sidelines of a number of international conferences. They seek


to promote trade, financial, political and cultural cooperation among Member


States and to "reform" global governance structures, particularly in the economic


and financial fields - working with the G20 Financial Forum, the International


Monetary Fund and the World Bank - as well as "reforming" institutions Such as


the United Nations.




From 2000 to 2008, the share of these four countries in world output rose


rapidly, from 16% to 22%, and their economies performed better than


the average during the subsequent global recession.




In 2015, the new development bank opened by the BRICS Group in Shanghai,


China, was launched. The Bank aims to balance the world's forces and end


the dominance of one particular power over the economy. This bank was among


the many things and plans that the BRICS Group sought to establish. Balance of


power and the curtailment of US policy that controls the global economy.




History of the BRICS establishing




In 2006, the BRICS was initiated by four countries: Brazil, Russia, India and


China. The prime ministers of these four countries met in New York on


the sidelines of a UN General Assembly meeting. And in 2009 they held their


first independent summit.




In 2010, through several negotiations in Russia in the city of Yekaterinburg,


South Africa sought to join the BRIC Group and formally joined them in


December of that year, becoming the name of the BRIC Group, to the BRICS


Group in its planned major economic plan, Said Russian Foreign Minister Sergei


Lavrov, declaring his desire to implement the binding agreements of the current


parties, without expanding plan and without adding other countries at that






Structure of the BRICS Group


The BRICS Group is located in Shanghai, China, and the new development


bank has also opened in Shanghai.



The group's chairmanship will be rotated every year, as will the hosting of


the summits each year in a rotating member state. In 2009, Dmitry Medvedev


hosted the event in Yekaterinburg, Russia. In 2010 he was hosted by Lula da


Silva in Brasilia, Brazil, and in 2011 hosted by Hu Jintao in Sanya, China, hosted


by Manmohan Singh in New Delhi, India in 2012, hosted by Jacob Zuma in


Durban, South Africa in 2013, and in 2014 hosted by Dilma Rousseff in Brazil.


Russia received the presidency from Brazil in 2015.



In the presidency of Russia was launched the New Development Bank,


the Monetary Reserve Fund, they agreed to establish a New Development Bank


(NDB) at their summit meeting. They will have a president (an Indian for the first


six years), a Board of Governors Chair (a Russian), a Board of Directors Chair


(a Brazilian), and a headquarters (in Shanghai).




 The capital of the BRICS Group is huge. It is about $ 200 billion. It is divided


into two halves: $ 100 billion capital for BRICS International Development Bank


and $ 100 billion for the cash reserve fund.


The initial authorized capital of the bank is $100 bln divided into 1 mln shares


having a par value of $100,000 each. The initial subscribed capital of the NDB is


$50 bln divided into paid-in shares ($10 bln) and callable shares ($40 bln).


The initial subscribed capital of the bank was equally distributed among


the founding members. The Agreement on the NDB specifies that the voting


power of each member will be equal to the number of its subscribed shares in


the capital stock of the bank.


Objectives of the BRICS Group



- The BRICS Group aims to balance the international economy and end


the monopolistic policy of the United States to dominate global financial policy.



- Creating an effective alternative to the International Monetary Fund and


the World Bank.



- achieving economic integration among the five member States economically


and politically, through establishing mechanisms of contribution between these


countries in times of crisis or the time of economic deterioration, instead of


resorting to one of the other dominant institutions.



- Developing the infrastructure of the five member countries, with an effective


method of granting and exchanging loans among members in a way that does


not adversely affect any country in them or cause any economic imbalance.



-Liberalizing those countries from the constraints of borrowing from other


Western institutions such as the International Monetary Fund (IMF), thereby


enhancing their global economic security by liberalizing them and saving them


from the benefits of Western institutions.