The idea of a BRIC grouping challenging the U.S. dollar is fairy tales as long as China and India are so divided and refuse to cooperate on trade, the former Goldman Sachs economist who came up with the BRIC acronym told Reuters. .
Russian President Vladimir Putin is using the BRICS leaders’ summit to show that Western efforts to isolate Russia over the Ukraine war have failed and that Russia is building ties with Asia’s rising powers.
Jim O’Neill, then chief economist at Goldman Sachs, introduced the term BRIC in a research paper in 2001, outlining the enormous growth potential of Brazil, Russia, India and China – and calling for their inclusion in global governance. Improvement was needed.
“The idea that BRICS could be some real global economic club is clearly out of step with the fairies in the same way that the G7 might be, and it’s very disturbing that they see themselves as some kind of alternative. Let’s see it as a global thing, because it’s clearly not possible,” O’Neill told Reuters.
“I feel like it’s basically a symbolic annual gathering where important emerging countries, especially noisy countries like Russia, but also China, can basically get together and highlight that How nice to be a part of something that doesn’t include America and that global governance isn’t good enough.”
O’Neill, who admitted that he would “have the stamp of Mr. Briscoe on my forehead forever”, said that the Briscoes as a group have achieved little in the past 15 years.
He said that it was not possible to solve truly global issues without the United States and Europe – just as it was not possible for the West to solve truly global issues without China, India, and to a lesser extent Russia and Brazil .
The BRICS grouping evolved from meetings between Russia, India, and China, which later began to meet more formally, eventually adding Brazil, then South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates. Saudi Arabia has yet to formally join.
The group now accounts for 45 percent of the world’s population and 35 percent of its economy in purchasing power parity terms, although China accounts for more than half of its economic power.
Putin opened the summit on Wednesday by saying that more than 30 states have expressed interest in joining the grouping, but it is important to strike a balance in any expansion.
Bringing more members into BRICS would make it even more difficult to accomplish anything, O’Neill said.
Dollar challenge?
Russia is trying to persuade the BRICS countries to create an alternative platform for international payments that would be free from Western sanctions.
O’Neill, 67, said people have been talking about alternatives to the dollar since he started in finance, but no country with the ability to challenge the dollar has seriously considered doing so. Nothing has been done for this.
Any BRICS currency would be heavily dependent on China, he said, while Russia and Brazil would not be a significant part of it.
“If they really want to be serious about economic matters, why don’t they actually have low-tariff based trade between each other?” O’Neill said.
“I will take the BRICS grouping seriously when I see signs that the two countries that really matter – China and India – actually agree on things rather than trying to effectively confront each other all the time.” “Trying to be.”
India has tried to curb Chinese investment in the country after the decades-old border dispute escalated into a clash between border guards in 2020. The two countries pledged to expand cooperation in their first formal talks in five years on Wednesday.
Chinese President Xi Jinping told Putin the international situation is in the grip of chaos, but Beijing’s strategic partnership with Moscow is a force for stability amid the most significant changes seen in a century.
O’Neill said the G20 has failed to truly become the pivot of global governance as both the United States and China have turned inward since the middle of the last decade. BRICS, he said, lacks clear objectives and should work on issues key to humanity – such as finding vaccines or medicines against infectious diseases, or fighting climate change.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
