How China is Using BRICS to Change the World Order

Cyrus Janssen

4 Sept 202310:15

Summary

TLDRThe 2023 BRICS Summit marked a significant shift in global power dynamics, emphasizing the move towards a multipolar world. BRICS, comprising Brazil, Russia, India, China, and South Africa, announced the inclusion of six new countries: Iran, Saudi Arabia, UAE, Argentina, Egypt, and Ethiopia. Together, the expanded BRICS controls nearly half the world's population and a third of global GDP. The alliance's aim is to challenge Western dominance, reduce reliance on the US dollar, and foster fairer global trade. China's key role in the summit, especially through deals with Saudi Arabia and Iran, highlights its growing influence.

Takeaways

🌍 BRICS is expanding in January 2024, welcoming six new countries: Iran, Saudi Arabia, UAE, Argentina, Egypt, and Ethiopia.
🇨🇳 China has secured major deals with Saudi Arabia and Iran, including a nuclear power plant in Saudi Arabia and an airport expansion project in Iran, bypassing the US dollar for crude oil.
💵 The BRICS alliance is focusing on trading in local currencies or valuable commodities, moving away from US dollar dominance.
🛢️ With the new members, BRICS countries will control 50% of global oil production, giving them significant power in global trade and resource management.
🇧🇷 Brazil and Argentina are collaborating to reduce reliance on the US dollar, with Argentina starting to trade with China using the Chinese yuan.
🌐 The BRICS alliance aims to give smaller, developing countries a voice in global affairs, offering an alternative to Western-led financial systems.
💬 The BRICS Summit emphasized the importance of dialogue, with India and China agreeing to deescalate border tensions and Egypt and Ethiopia resuming peace talks over the Nile River dispute.
📊 The BRICS alliance is seen as a challenge to the US-led world order, aiming to create a more multipolar global structure.
💡 Some BRICS members, like Brazil’s president, have expressed long-term goals of creating a common BRICS currency to further reduce dependence on the US dollar.
🌱 Through China’s Belt and Road Initiative, BRICS is helping to drive industrialization and development in many African nations, providing them with new economic opportunities.

Q & A

What is the main focus of the BRICS alliance as discussed in the video?
-The main focus of the BRICS alliance is to create a multi-polar world where developing countries' voices are heard, and they are treated fairly. It aims to challenge Western hegemony and reduce reliance on the US dollar by promoting trade in local currencies and commodities.
Which six countries are set to join BRICS in January 2024?
-The six countries joining BRICS in January 2024 are Iran, Saudi Arabia, the UAE, Argentina, Egypt, and Ethiopia.
Why is China's role in BRICS considered a 'massive victory' at the 2023 BRICS Summit?
-China secured significant deals with Saudi Arabia and Iran at the 2023 BRICS Summit, including a nuclear power plant project with Saudi Arabia and a $2.7 billion airport expansion with Iran, which will be paid for in crude oil, bypassing the US dollar.
What is the significance of BRICS trading in local currencies or commodities?
-Trading in local currencies or commodities allows BRICS members to bypass the US dollar, reduce dependence on Western financial systems, and mitigate the risks of sanctions, especially for countries like Iran.
How does the BRICS alliance impact global oil production?
-With the addition of Saudi Arabia, the UAE, and Iran, BRICS countries will control 50% of global oil production, giving them significant leverage in global energy markets and the ability to trade oil without using the US dollar.
What does BRICS mean for developing countries in Africa, like Egypt and Ethiopia?
-For African countries like Egypt and Ethiopia, joining BRICS provides an opportunity to break away from Western financial dominance, reduce import costs by trading in local currencies, and increase access to investment and development projects led by BRICS nations, particularly China.
What long-term goals does BRICS have regarding a common currency?
-BRICS members, like Brazil’s president, have expressed a desire for a common currency, possibly backed by gold, to reduce reliance on the US dollar. However, this is seen as a long-term strategic goal, with the short-term focus on reducing dollar dependency and increasing local currency trade.
How has China used its Belt and Road Initiative (BRI) to strengthen relationships with BRICS members?
-China has used the Belt and Road Initiative to invest in infrastructure projects across developing countries, including many in Africa. These investments have given smaller countries a stronger voice in international matters and deepened their economic ties with China and the BRICS community.
What role does Saudi Arabia play in the BRICS alliance, and why is it important?
-Saudi Arabia is a key oil producer and long-time US ally, but its increasing ties with China, such as buying a stake in a Chinese petrochemical company, signal its shift toward the BRICS alliance. Saudi Arabia’s inclusion strengthens BRICS' control over global oil supply chains.
What diplomatic impacts has the BRICS alliance had, according to the video?
-The BRICS alliance has facilitated diplomatic resolutions, such as China and India deescalating border tensions and Egypt and Ethiopia resuming peace talks over their territorial dispute. These examples illustrate how BRICS fosters dialogue and cooperation among its diverse members.

Outlines

00:00

🌍 BRICS Expands and Challenges U.S. Global Dominance

China has secured a major victory at the 2023 BRICS Summit, signaling the end of a U.S.-led unipolar world and the rise of a multipolar global structure. The BRICS nations—Brazil, Russia, India, China, and South Africa—are focused on breaking free from Western hegemony. The summit's key outcome is the expansion of BRICS in January 2024, with six new members: Iran, Saudi Arabia, the UAE, Argentina, Egypt, and Ethiopia. This expansion will include 11 countries, representing half of the world's population and a third of the global GDP. China is the biggest beneficiary, securing deals with Saudi Arabia and Iran, including the development of a nuclear plant and a $2.7 billion airport project, paid for in oil. These developments highlight BRICS' strategy to bypass the U.S. dollar in global trade, challenging Western dominance.

05:01

💼 Saudi Arabia and the UAE Strengthen Ties with BRICS

Saudi Arabia and the UAE, two of the world's top oil producers, have joined BRICS, diversifying their alliances and reducing reliance on Western nations. Saudi Arabia, a longtime U.S. trading partner, is building stronger relations with China, seen through the introduction of Mandarin in schools and a $3.6 billion petrochemical deal. The UAE, with its $1 trillion sovereign wealth fund, aims to increase capital investment in BRICS projects, adding financial muscle to the alliance. Both nations' inclusion signifies their strategic shift toward the Global South, reinforcing the BRICS objective of bypassing the U.S. dollar in international trade.

10:02

🏭 Iran and Argentina Gain New Economic Lifelines

Iran, heavily sanctioned by the U.S., benefits from joining BRICS as the alliance provides alternative trade options, bypassing the U.S. dollar. Iran's ability to conduct trade with other BRICS nations, such as using crude oil to pay for infrastructure projects, offers it economic resilience. Argentina, facing long-standing currency issues, joins to diversify its trading partners and reduce its dependence on the U.S. dollar. Argentina brings valuable minerals and raw materials to the BRICS group, contributing to the alliance's future growth despite lacking the deep financial resources of other members.

🌍 Egypt and Ethiopia's Quest for Financial Independence

Egypt and Ethiopia have joined BRICS primarily to break free from Western-dominated financial systems, which have burdened them with rising import costs. Both countries plan to trade with China, India, and Russia in local currencies, reducing their reliance on the U.S. dollar. The BRICS alliance offers these African nations a platform for financial and industrial growth, with China pledging to further support Africa's industrialization and agricultural development. Egypt sees BRICS as a way to amplify the voice of the Global South, focusing on trade and investment opportunities that reduce reliance on Western financial systems.

💡 The Vision for a BRICS Common Currency

Many BRICS leaders, including Brazil's president, dream of creating a common currency to reduce their reliance on the U.S. dollar, similar to the Euro in Europe. Although a BRICS currency backed by gold is a long-term goal, the short-term strategy focuses on reducing U.S. dollar dependency and avoiding U.S. sanctions. This shift would allow BRICS members to trade more freely, bolstering their economies. Additionally, despite the diverse cultures and political systems within BRICS, the alliance has fostered peace and dialogue, as evidenced by border talks between China and India, and renewed peace efforts between Egypt and Ethiopia.

🌍 BRICS: A Rising Alliance in a Divided World

The BRICS alliance, now set to include six new members, is emerging as a powerful force in global geopolitics, controlling significant supply chains of key resources like crude oil and raw minerals. While some critics argue the diversity of BRICS members may lead to internal challenges, the alliance represents the hopes of many countries in the Global South, who are now being heard and given opportunities to rise. BRICS symbolizes a new world order, where smaller nations can thrive outside the control of Western-dominated institutions, making it a formidable and growing global power.

💬 The Future of BRICS and Global Currency Dominance

As the BRICS countries continue to grow in influence, surpassing the G7 in terms of GDP growth, there are debates about the next milestones for the alliance. While some predict the creation of a new BRICS currency to challenge the U.S. dollar, others believe the focus will remain on strengthening trade in local currencies. The video concludes by encouraging viewers to engage in the discussion about BRICS’ future, whether it will launch a gold-backed currency, and what other major accomplishments are on the horizon for the alliance.

Mindmap

Keywords

💡BRICS

BRICS is an economic and political alliance comprising Brazil, Russia, India, China, and South Africa. It represents a coalition of emerging markets seeking to reshape global economic structures and challenge Western dominance, particularly that of the U.S. The video discusses the recent expansion of BRICS with the inclusion of six new countries, signaling a significant shift towards a multipolar world.

💡Multipolar world

A multipolar world refers to a global order where multiple nations or coalitions share power and influence, as opposed to a unipolar world dominated by one superpower, such as the U.S. The BRICS alliance embodies the move towards this new order, providing smaller and emerging nations a platform to assert their interests on the global stage, as highlighted in the video.

💡China

China plays a pivotal role in the BRICS alliance, with its economic and diplomatic influence being a major factor in shaping the group's strategies. In the video, China is portrayed as a big winner from the 2023 BRICS Summit, securing key deals with Saudi Arabia and Iran, and leading initiatives such as infrastructure projects and efforts to bypass the U.S. dollar in trade.

💡U.S. dollar

The U.S. dollar has traditionally been the dominant global reserve currency used in international trade. However, the BRICS alliance is increasingly promoting trade in local currencies or commodities, as seen with Iran's $2.7 billion airport project being paid in crude oil. The video emphasizes how BRICS aims to reduce dependence on the U.S. dollar, challenging its dominance in global markets.

💡Belt and Road Initiative

The Belt and Road Initiative (BRI) is China’s global infrastructure development strategy that invests in transportation, energy, and trade projects across Asia, Africa, and beyond. The video highlights how BRI has allowed China to strengthen ties with over 150 countries, providing these nations with much-needed development while reinforcing China’s influence.

💡Saudi Arabia

Saudi Arabia, one of the six new BRICS members, holds strategic importance as a major oil producer and long-time U.S. ally. The video discusses its increasing shift towards BRICS, evidenced by significant business deals with China and the introduction of Mandarin in schools, signaling a growing alignment with China and the BRICS agenda.

💡BRICS expansion

BRICS expansion refers to the 2024 inclusion of six new countries—Saudi Arabia, UAE, Iran, Argentina, Egypt, and Ethiopia—into the alliance. This historic expansion is described in the video as a major development, further solidifying BRICS as a global force representing almost half the world’s population and controlling significant oil production and global trade.

💡Sanctions

Sanctions, particularly those imposed by the U.S., are punitive measures aimed at restricting trade and financial activity with targeted countries, like Iran. The video explains how BRICS offers countries like Iran a lifeline to bypass such sanctions by facilitating trade in local currencies or commodities, thus reducing the impact of U.S. sanctions.

💡Global South

The Global South refers to developing regions in Africa, Latin America, Asia, and the Middle East. The video emphasizes how BRICS provides these regions a platform to have their voices heard and to break away from Western-dominated financial and political systems, allowing them to trade more freely and on equal terms.

💡BRICS currency

A BRICS currency is a potential future currency for the BRICS nations, potentially challenging the dominance of the U.S. dollar in global trade. Although the video suggests this is a long-term goal, there is strong interest from countries like Brazil in creating a common BRICS currency, possibly backed by gold, to promote trade independence from the U.S. dollar.

Highlights

BRICS expanded to include six new countries: Iran, Saudi Arabia, UAE, Argentina, Egypt, and Ethiopia in January 2024, making a total of 11 members.

The expanded BRICS network will represent almost half the world's population and produce a third of global GDP.

Iran and China made a $2.7 billion airport expansion deal, where Iran will pay using crude oil, bypassing the US dollar.

BRICS represents a challenge to the US-led world order by promoting trade in local currencies or commodities, rather than relying on the US dollar.

China secured major deals at the BRICS summit, including a nuclear power plant in Saudi Arabia and other strategic partnerships.

BRICS now controls 50% of global oil production with the addition of Iran, Saudi Arabia, and UAE, enabling the group to bypass US sanctions.

The UAE will be contributing new capital to BRICS-controlled development projects, particularly through its $1 trillion sovereign wealth fund.

Argentina, facing currency troubles, will benefit from trade agreements with BRICS members, particularly moving away from the US dollar.

BRICS members like Egypt and Ethiopia are joining to gain more financial independence from Western financial systems.

BRICS may aim to create a new global currency, potentially backed by gold, to further reduce reliance on the US dollar.

China has invested in over 150 countries via its Belt and Road Initiative, emphasizing infrastructure over military bases.

At the summit, China announced further investment in Africa, including industrialization efforts and training for 20,000 African students.

India and China have deescalated their border tensions through dialogue facilitated by BRICS cooperation.

Egypt and Ethiopia have resumed peace talks over a Blue Nile dam dispute after joining BRICS, reflecting the alliance’s focus on peaceful solutions.

BRICS surpassed the G7 in terms of GDP growth, showing its rising economic power and influence on the global stage.