The former Goldman Sachs economist who invented the BRICs acronym told Reuters that as long as China and India remain so divided and refuse to cooperate on trade, the idea that the BRICS group will always challenge the US dollar is a fairy tale gain. He said it would be.
Russian President Vladimir Putin uses the BRICS summit to argue that Western attempts to isolate Russia over the Ukraine war have failed and that Russia is building ties with Asia’s rising powers. It shows.
In 2001, Jim O’Neill, then chief economist at Goldman Sachs, published a research paper highlighting the enormous growth potential of Brazil, Russia, India, and China, and the need for global governance reform to include these. Introduced the term BRICs.
“The idea that the BRICS could be a true global economic club, just as the G7 could be, is clearly a bit alien to the fairies and the idea that they could see themselves as some sort of alternative global economic club. It’s very worrying that we’re looking at it as something that’s clearly not possible,” O’Neill told Reuters.
“This is basically a symbolic event where important emerging countries, especially noisy countries like Russia but also China, can basically come together and emphasize how great it is to be a part of something that doesn’t involve the United States and America. It seems to me that global governance is not sufficient. ”
“I will forever have Mr. BRICS stamped on my forehead,” O’Neill admitted, noting that the BRICS as a group had achieved little in the past 15 years.
He believes that just as the West cannot solve real global problems without China, India, and to a lesser extent Russia and Brazil, it is impossible to solve real global problems without the United States and Europe. He added that it was possible.
The BRICS group evolved from meetings of Russia, India, and China, then began to meet more formally, and was eventually joined by Brazil, South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates. Saudi Arabia is not yet an official member.
Currently, based on purchasing power parity, this group accounts for 45 percent of the world’s population and 35 percent of the world’s economy, with China accounting for more than half of its economic power.
President Putin said at the outset of the summit on Wednesday that more than 30 countries have expressed interest in joining the group, but that it is important to balance expansion.
O’Neill said bringing more members into BRICS would make it even more difficult to achieve anything.
Dollar challenge?
Russia is trying to persuade BRICS countries to create alternative platforms for international payments that are not affected by Western sanctions.
O’Neill, 67, said since he entered the financial industry people have been talking about alternatives to the dollar, but none of the countries that could potentially challenge the dollar are seriously trying. Ta.
He said all BRICS currencies are highly dependent on China, and Russia and Brazil will not be a significant part of that.
“If they really want to think seriously about economic issues, why don’t they seriously pursue lower tariff trade between the two countries?” O’Neill said.
“I’m going to take the BRICS group seriously when I see signs that China and India, two really important countries, are actually trying to agree on things instead of trying to be at odds virtually all the time.”
India has sought to curb Chinese investment in the country since a decades-old border dispute escalated into border guard clashes in 2020. The two countries pledged Wednesday to step up cooperation in their first formal talks in five years.
Chinese President Xi Jinping told President Putin that although the international situation is in turmoil, the strategic partnership between China and Moscow is a stabilizing force amidst the greatest changes in a century.
O’Neill said the G20 had failed to become a true global governance organization because the United States and China had both turned inward since the middle of the last decade. He said BRICS lacked clear goals and should address issues important to humanity, such as finding vaccines and treatments for infectious diseases and combating climate change.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
