Towards a “BRICS Consensus”

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The 5th BRICS Summit in Durban, the first one to take place on African soil, may not contain many surprises, but underlined that the BRICS are serious in their endeavor to slowly but surely reform global order to better reflect the global shift of power away from Europe and the United States towards the emerging world. Belittled by mainstream commentators as a "motley crew" unable to find a common denominator, the creation of a BRICS Development Bank (BDB) and a $100 billion contingency fund sends a clear message to the international community about the BRICS' willingness to deepen and broaden cooperation between them.

Perhaps unwilling to recognize these trends, opinion articles in The Atlantic and The Telegraph today sought to point out that the idea of the BRICS "had run its course" and that it was "time to invent a new acronym". Yet such analyses are besides the point - the BRICS club contains no clause that automatically excludes any member that grows less than 2 percent per year. The BRICS has turned into a political project long ago - after all, if market size and growth rates were all that mattered, the BRIC grouping would have invited Indonesia, and not South Africa in late 2010. Giving the BRICS advice about its membership structure is a bit like telling NATO that it should exclude Bulgaria because the country is too far away from the North Atlantic.

Far more interesting is the emergence of a BRICS consensus that may be a game changer in developmental finance across Africa, and with it in the entire developing world. Just like Brazil's and China's development banks have been instrumental in each country's commercial policy, the BRICS Development Bank may influence development not only in India and South Africa, but in several other African countries as well - provided that the BRICS Bank will engage outside of the BRICS.

Will emerging powers' projects, such as the BRICS Development Bank, undermine existing institutions and the principles that sustain them? BRICS policy makers go out of their way to point out that the BRICS Development Bank will "complement" existing institutions - yet why then, skeptics will ask, do they not hand over the money to the World Bank, the IMF or other institutions that are already in place? Why go through the hassle of creating a new institution?

The answer is that while emerging powers seek a larger role within the existing framework, they do not feel established powers are willing to provide them with the adequate power and responsibility - reforms at the World Bank and the IMF have been too slow, and not far-reaching enough. The World Bank remains, despite its name, essentially a Western-dominated institution in the eyes of emerging powers. It is difficult to read the creation of the BRICS Development as anything other than that.

Yet perhaps equally interesting, the creation of the BRICS Development Bank may be seen as the beginning of a BRICS Consensus - symbolized by the pursuit of a state-led economic growth strategy sustained by strong development banks. Like it or not, it may be the most coherent response yet to the Washington Consensus.

Read also:

Can the BRICS Co-operate in the G-20? A View from Brazil

BRICS will continue to receive membership applications

Will BRICS Change the Course of History?

 
Photo credit: official website of Russia's Presidency in BRICS