BRICS: Indonesia to become a fully-fledged member
Indonesia will become the newest fully-fledged member of the BRICS alliance in 2025, according to Reuters on January 7, 2025. Their membership is an expression of the expansion push endorsed at the 2023 BRICS summit.
The Brazilian government issued a statement on January 6th declaring: “”Indonesia shares with the other members of the group support for the reform of global governance institutions and contributes positively to the deepening of cooperation in the Global South”.
Indonesia’s motives to join are to strengthen emerging countries and further the interests of the Global South through multilateral cooperation. The Indonesian Foreign Ministry said: “BRICS membership is a strategic way to increase collaboration and partnership with other developing nations”.
They said its new membership reflects Indonesia’s increasingly active role in global issues, and its commitment to collaboration “based on the principles of equality, mutual respect, and sustainable development”.
BRICS is a primarily economic alliance created by Brazil, Russia, India and China in 2009 until South Africa joined in 2010. It was designed to combine the power of developing nations, primarily in the Global South, and use it as a counterweight against the power of the G7 (comprised of the 7 largest, most developed economies).
Since its formation, its membership has expanded to include Egypt, Ethiopia, Iran, and the United Arab Emirates. Its roster is now set to include Indonesia, with Turkey, Azerbaijan, and Malaysia having formally applied. Saudi Arabia has been invited to join but has not agreed yet.
The BRICS alliance accounts for nearly 45 percent of the world’s population and 35 percent of Gross Domestic Product – GDP, based on purchasing power parity. These figures do not include Indonesia.
With Indonesia as the world’s fourth most populous nation, the BRICS alliance is set to increase its global standing through dominating the Global South. Its originary goal was to create a coalition of countries set to dominate the global economy by 2050.
The expansion of the BRICS alliance appears to have stirred some concern in US President-elect Donald Trump who threatened 100% trade tariffs on BRICS nations if they challenge the hegemony of the US dollar.
The Associated Press reported on November 30, 2024, that Trump, in a Truth Social post, said: “We require a commitment from these Countries that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy.” Tariff appears to be Trump’s favourite word.
The dollar represents roughly 58 percent of the world’s foreign exchange reserves and most global trade happens in dollars. However, with the BRICS’ growing share of global GDP; their membership including states with large oil reserves; and, their desire to trade in non-dollar currencies leads some analysts to believe the dominance of the dollar is threatened.
Russia has specifically pushed for the use of non-dollar currencies or even the creation of a new payment system that would allow Mosco to dodge Western sanctions.
However, according to the Atlantic Council model, the role of the dollar as the primary global reserve currency is “secure in the near and medium term”. Yet with Trump set to enter the White House on a manifesto of high tariffs on America’s enemies, the consequences of the BRICS expansion remains to be seen.
Reuters
