The place of Africa in BRICS expansion

MULTILATERAL COOPERATION got another boost last Wednesday at the end of the 15th BRICS Summit in South Africa. Described as “Johannesburg II Declaration,” with a broad theme of “BRICS and Africa: Partnership for Mutually Accelerated Growth, Sustainable Development and Inclusive Multilateralism,” the report at the end of the meeting in Sandton, Gauteng, laid out 94 points on how BRICS would influence the world affairs in the future. Clearly, the group, made up of members from Brazil, Russia, India, China and South Africa, is about to expand its membership by taking in more countries in the next one year. Whether that decision will change its name from the existing acronym into another acronym to reflect the new countries as a composition is not yet a settled matter. Notwithstanding whatever new name is assigned to the group after the entry of new members in 2024, it is clear that Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates (UAE) will become full members of BRICS from January 1, 2024. The new entrants are the few that were considered eligible for admission into what has become an influential global geo-strategic economic bloc despite the over 40 countries that reportedly applied to join.

Observing “the considerable interest shown by countries of the global South in membership of BRICS,” the Johannesburg II Declaration pointed out what it described as “the BRICS Spirit and commitment to inclusive multilateralism,” in which BRICS countries reached consensus on the guiding principles, standards, criteria and procedures of the BRICS expansion process. The foreign ministers of BRICS have therefore been tasked with the responsibility to further develop the BRICS partner country model and a list of prospective partner countries, to be submitted at the next (16th BRICS) Summit scheduled for the city of Kazan in Russia in 2024. Of particular interest, however, is the finding that the request submitted by Nigeria — the biggest economy in Africa — to join BRICS was rejected. This raises a number of questions to which immediate answers may not be readily available.

However, admitting Egypt and Ethiopia from north and east Africa, respectively, could be interpreted as having geopolitical and strategic economic relevance. For instance, Egypt has been a prominent trading partner with Russia, from where it imports most of the wheat it consumes. Moreover, Egypt’s president, Abdel Fattah el-Sisi, is an ally of Putin’s regime. The same Egypt is a major importer of beef from Brazil. In 2022, Egypt bought 81,300 tonnes of Brazilian beef from January to August, up from the 41,300 tonnes registered in the same period of 2021, coming third behind China and the US as a Brazilian beef importer, according to information released by the Brazilian Meat Packers Association (Abrafrigo). The data was in reference to fresh and processed beef. Moreover, Egypt’s wheat imports from Russia account for nearly 60 percent of its annual wheat imports, estimated at 57 percent in 2022, up from 50 percent in 2021 because of the impact of Russia invasion of Ukraine, which hampered the latter’s ability to export wheat, leading to a fall in shipments from Ukraine, which accounted for 8.9 percent of Egypt’s wheat imports. In five years before the invasion of Ukraine, Egypt’s imports of wheat amounted to 62.6 million metric tonnes (MMT) with 59.7 percent from Russia and 22.3 percent from Ukraine — 82 percent combined.

Ethiopia’s admission could have been similarly influenced. The disposition of Ethiopia to the US in the course of the Abiy Ahmed-led two years of war against Tigray people was one of a diplomatic standoff, which could have pushed Ethiopia closer to the US rivals. Although Russia has long been one of Ethiopia’s leading suppliers of military hardware, the military pact of Ethiopia with Russia could have played up in Ethiopia’s favour in the BRICS selection process as insiders had the sole criteria for selection of candidates. In July 2021, while the war against Tigray lasted, Russia and Ethiopia signed a military cooperation agreement as part of the spinoffs of a military technical cooperation forum. According to the Finance Division State Minister of the Ethiopian National Defence Force, Martha Liwij, the agreements will have a “paramount significance” in transforming the longstanding relations between the two nations to a higher level. “The agreement will be focusing on transforming the capacity of the (Ethiopian) national defence force in knowledge, skill and technology spheres,” she said. Ethiopia’s diplomatic relations with China remained intact. Moreover, the economic footprints of China are quite clearly visible in Ethiopia as a major country with probably the highest foreign direct investment (FDI) in Ethiopia, both in volume and value. In a 2020 report, the United Nations Conference on Trade and Development (UNCTAD) disclosed that China has remained the largest foreign direct investment (FDI) source in Ethiopia, accounting for about 60 percent of the newly approved foreign projects in the East African country during the previous year. According to the report, Ethiopia was the biggest FDI recipient in the East Africa region and the fourth largest FDI destination in Africa.

Although the reasons for rejecting Nigeria’s application to join BRICS are not immediately obvious, more facts are expected to become obvious with time. One prominent theory or supposition, for now, could be that of the putative winner of the 2023 election and his pro-West policies which could run counter to the current Africa agenda of China and Russia. In particular, the alliance with the US and France against Niger’s military leaders and the strident calls for reinstatement of the deposed President Mohamed Bazoum may not have gone down well with Russia and — to a less obvious extent — China. This could be significant, especially considering that BRICS is intended to provide an alternative platform on trade, geopolitics and economy in a world that is presently seen as unipolar and dominated by Western influence. The second theory could be related to one of the points mentioned in the Johannesburg II Declaration, which is number 43. It states that BRICS “support enhancing statistical cooperation within BRICS as data, statistics and information form the basis of informed and effective decision making.” It added that, “on the 10th anniversary of its first issue, we support the continued release of the BRICS Joint Statistical Publication 2023 and the BRICS Joint Statistical Publication Snapshot 2023 for engaging a wider range of users. By implication, statistics submitted by Nigeria while applying could have been found untenable and could be one of the grounds for disqualification. BRICS, considered as an alternative to global bodies viewed as dominated by the traditional Western powers, will very likely be wary of certain things about country applicants while taking decisions on admitting new members.

BRICS group, determined to provide a strong alternative to what has been considered as promoters of Western hegemonic multilateral organisations, namely the World Bank and the International Monetary Fund (IMF), has set up a number of ambitious programmes and institutions while also outlining many others expected to become formidable rivals to what has been regarded as global status quo, and offering viable development alternatives.

Central to the BRICS’ attraction is its rising economic heft as the five member nations now have a combined GDP larger than that of the G7 in purchasing power parity terms. Moreover, in nominal terms, the BRICS countries are responsible for a quarter of the global GDP. A strong ground for promoting BRICS is that, despite the significance of the economic strength, the member countries get only 15 percent of the voting power at the IMF.

In addition to grievances over such imbalances are growing concerns in the Global South that the US could weaponise the dollar through sanctions, especially as done against Russia. This has prompted BRICS nations to individually and collectively begin to reduce their dependence on the US currency while increasing bilateral trade in their own currencies. International finance is central to the strategies of BRICS. The idea of BRICS bank, alternative payment system other than one involving the use of dollar and a number of other initiatives set out within the BRICS framework should leave no one else in doubt about the strategic realignments that BRICS has set out to champion. BRICS Development Bank, known as New Development Bank (NDB), is a multilateral development bank established by the BRICS states of Brazil, Russia, India, China and South Africa through a treaty signed in July 2014 but came into force in July 2015. Headquartered in Shanghai, China, NDB has been touted as one that will promote the inclusion of new members and finance in local currencies of member countries. But one of the sticking points in BRICS is the subtle attempt of China at promoting the yuan as an alternative to the dollar, a step many suspect as a backdoor approach to exerting China’s dominance through the BRICS platform. This, it is surmised, could heighten the misgivings about China if not discreetly managed. The Agreement on NDB states that “the Bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments.” It is also stated that the NDB “shall cooperate with international organisations and other financial entities, and provide technical assistance for projects to be supported by the Bank.”

Influences of early member countries are already being brought to bear in NDB as the Board of Governors of the financial institution had, on March 24, 2023, unanimously elected the former president of Brazil, Mrs. Dilma Vana Rousseff, as the President of the Bank. Assurances that BRICS will give African countries another alternative and another model for development that is not the same as the Western models could be a reason for bringing in two additional countries in Africa after South Africa. How those countries manage their membership and what they are able to gain through their membership will be coming to light as an expanded BRICS takes shape. But, the rejection of Nigeria in the new arrangement is a cause for concern as the biggest market in the continent has been tactically dropped. Nigeria needs to get back to the drawing board to identify where it missed such an opportunity and how to make up for this loss.