BRICS: Quietly eroding Western global dominance
World order shifts closer to change

ANALYTICS  02 July 2024 - 17:53

Amidst the West's internal fractures, the European Union commenced accession talks last week with Ukraine and Moldova, nations already fragile even before recent conflicts. History shows the EU struggles to uplift such states, often leaving them behind post-accession despite Brussels' aid. Now burdened by internal crises and conflicts with Russia and China, the EU faces unprecedented challenges to its dominance.

Simultaneously, Bloomberg highlights a quieter, external threat: the rising influence of BRICS, a bloc of major non-Western powers. Unlike the EU, it is expanding at the expense of dynamic countries, and the weight of this association of non-Western countries in world politics will soon exceed the weight of the G7, consisting of the key countries of the "collective West". Judging by the hopeless stagnation in the political establishment of the US, EU and the rest of the West, there are no politicians there capable of preventing the impending change of the world order.

A new challenge to Western dominance has quietly arisen with the emergence of BRICS in the early 2000s. The acronym itself, composed of the initial letters of its founding members - Brazil, Russia, India, China, and South Africa - suggests its modest beginnings. Central to BRICS is China, which adheres to the principle of a "peaceful rise" in global affairs, avoiding overt emphasis on its leadership role within the group.

The rapid growth of the BRICS began in recent years as Western countries faced an unrelenting wave of economic and political crises. After seeing the US fleeing from Kabul and throwing its Afghan collaborators off the landing gear of planes, the West's inability to cope with the Yemeni rebels, not to mention the confrontation with Russia in Ukraine, in which the US is rushing to hand over this "toxic asset" to the Europeans, even countries not seen in anti-Western sentiments began to think about alternatives.

As early as last August, the Persian Gulf's all-important Saudi Arabia, which is increasingly cooperating with China, was invited to join the bloc. It is still haggling over the terms, and meanwhile since the beginning of the year three other economically large and promising Middle Eastern countries - Egypt, UAE, Iran - and neighbouring Ethiopia have joined BRICS. This month, two very different but large and promising countries - Malaysia and Thailand - also expressed similar intentions.

The bloc is expanding less successfully in Latin America, where pro-American President Milei refused to join after the change of power in Argentina. But even there, not only Bolivia and Venezuela but also Colombia, previously controlled by quite pro-American elites, have recently announced their desire to join. These countries have bigger problems than the above-mentioned countries, but they will also strengthen BRICS. For example, Colombia and Venezuela are members of OPEC, and their role in the world oil markets can hardly be overestimated.

Most of the above countries (except Iran and a couple of others) have not yet challenged the West ideologically, which is why their solutions are so curious. After all, even countries historically integrated with the West are looking at China and the BRICS.

The entry of these countries will deal a crushing blow to the global dominance of the "collective West" countries in the economic field. Even before the accession of the new countries, the BRICS was close to taking the lead in the world economy. According to IMF statistics (which are not sympathetic to the bloc), the G7 countries in 2023 will own 43.7% of global GDP, while the BRICS will own 26%. But when recalculated to more objective purchasing power parity GDP figures, it turns out that even then the BRICS countries accounted for 31.5 per cent of global GDP, while the G7 accounted for 30.7 per cent. The G7 includes all the key countries of the "collective West" - the US, Germany, Japan, the UK, France, Italy and Canada.

The growing strength of BRICS goes beyond mere economic metrics like GDP or member indicators. It signifies a shift where member nations, spurred by harsh Western sanctions, are increasing trade amongst themselves. This undermines the longstanding Western influence, historically maintained through global trade, supply chains, and logistics dominance. From 2017 to 2022, intra-BRICS trade surged by 56% to $433 billion, signalling deeper economic integration. Moreover, BRICS nations now offer each other financial support, demonstrating a new solidarity. Politically, these nations resist Western pressures to condemn Russian or Chinese policies, thwarting Western diplomatic strategies.

BRICS isn't alone in challenging Western hegemony. China, alongside BRICS, is also shaping alternative alliances like the Shanghai Cooperation Organization (SCO), often dubbed "its own NATO." The SCO has been actively integrating with organizations like the CSTO, with Belarus set to join in July. This strategic alignment underscores a broader movement among non-Western nations to reshape global dynamics, potentially reducing the West's dominance to a more modest role in the future.

Negative EU growth

The European Union faces a stark reality amidst shifting global alliances and blocs that may redefine the world order. Within the collective West, there is a noticeable decline across political, economic, social, and technological domains.

A poignant example is the European Union, a cornerstone of the Western world. On Tuesday evening Brussels launched the process of negotiations on the accession of Ukraine and Moldova. Plans are voiced to admit these countries to the EU as early as 2030. Meanwhile, they were structurally weak even before the war, and given the tremendous military destruction in the case of Ukraine and the consequences of the war in the case of Moldova, this is a suicidal decision. It is based on political voluntarism, thickly mixed with liberal Euro-Atlantic ideology (or should I say theology) and even racism. To understand this, one can simply compare it with the way Brussels dealt earlier with Türkiye and more recently with the also much more prepared Georgia. They were pushed out of the accession process for their unwillingness to submit to any Western demands.

The EU will grow in the east, but it will be negative growth - even in the optimistic scenario of an end to the Russian-Ukrainian war in the next couple of years. The accession of Ukraine and Moldova will add land and population to the EU - but it will be economically prohibitively expensive. And it's not even about the "dead" economy, corruption, etc.: even the very structure of the population of both countries is characterised by many parameters negative for economic growth - extremely low birth rate, high mortality rate and the fact that the bulk of relatively qualified citizens have already left.

However, the political decisions of the Brussels bureaucracy and some EU leaders regarding expansion to the East are not dictated by considerations of the rational interests of the EU and its members. They are much more dictated by the interests of liberal elites, who are increasingly losing to their political rivals in elections and real politics and are therefore trying to play adventurous games. So what if the EU cannot protect European economies from Washington's luring of promising industries overseas? Von der Leyen can solemnly announce expansion to the East! And it's working: on June 28 she won reappointment to her post in Brussels, while Charles Michel, who had been more cautious, did not.

Against this background, talking about the possibility of including Armenia in a new type of European integration process looks logical. For the Brussels and Paris elites, this is an opportunity to demonstrate their ability not just to enlarge the EU, but to get involved in a completely new region for them - the South Caucasus. The rapprochement with Armenia, even before its accession, will require the EU to allocate additional resources, which, let us repeat, will not lead to Armenia's prosperity, just as such EU allocations have not led to the prosperity of any such country - the Balkans and Eastern Europe are a case in point. It's all about the conditions that are set in Brussels. Both sides will be at a disadvantage in the current arrangement.

More European money for war and job creation in the US

Another facet of EU enlargement involves significant implications: the integration of Ukraine and Moldova, alongside closer relations with Armenia, signifies a new strategic landscape for Brussels. This expansion could potentially escalate tensions with Russia, already evident in the strain on the European Union's economic powerhouse, Germany. Germany is grappling with a severe budget crisis, exacerbated by recent political fractures within its coalition government. The spectre of political instability looms, with the possibility of the far-right Alternative for Germany gaining prominence once more.

In response to pressures from Washington, Germany has hastily earmarked over seven billion euros for Ukrainian weapons and is ramping up military spending to meet demands to allocate 2% of GDP for defence, even ahead of a potential return of Trump to the White House. These moves risk breaching legal limits on public debt growth, exacerbating the very crisis they seek to manage. Meanwhile, social expenditures, education, and scientific funding remain underfunded, contributing to ongoing strikes by school teachers demanding improved working conditions and fair compensation.

Thus, while resources abound for military endeavours, both within the budget and through extensive extra-budgetary funds, the strain on domestic priorities like social welfare and education remains starkly evident.

In the lead-up to the NATO summit, European Union members are aligning to address U.S. expectations, particularly regarding increased military spending and defence efforts against Russia. Ahead of the summit, outgoing NATO Secretary General Jens Stoltenberg visited Washington, highlighting that 23 out of 32 NATO members are set to meet the 2% of GDP target for military expenditures this year, with only seven projected to achieve this in 2022. Importantly, Stoltenberg openly acknowledged during his meeting with President Biden that a significant portion of this spending goes directly to purchasing American-made weapons.

This revelation underscores a long-standing trend where European NATO countries have largely relinquished ambitions to develop their own defence industries, opting instead to procure weapons from the United States. Stoltenberg's candid statement to U.S. officials, asserting that "NATO is good for US security, and NATO is good for US jobs," highlights the pragmatic alignment of European defence policies with American interests, potentially at the expense of nurturing a distinct European defence identity within the alliance.

NATO's presence in Asia aims to bolster a weakening US

Meanwhile, EU-NATO countries are joining the US confrontation with China. Last week, during his visit to Vietnam, Russian President Putin commented on the Euro-Atlantic bloc's ambitions in the Far East: "NATO is already 'moving in' there - as if it were a permanent residence." In mid-July, the air forces of Germany, France and Spain will send their units - actually a combined fighter regiment - to the Pacific for the first time. This will be done so far as part of a series of joint two-month exercises with the Japanese Air Force. After the exercise in Japan, NATO aircraft will conduct manoeuvres with two other countries in the region - India and Australia - as well as the US. In this way, the EU-NATO countries are demonstrating that it is not about a symbolic presence in the region, but about supporting any options for confronting China.

All this is a continuation of the trend of NATO deployment in the new Indo-Pacific region, which began with the alliance's representation in Tokyo. Today, the European Union is already preparing to conclude military partnership agreements with Japan and South Korea. Over the past couple of years, Japanese Prime Minister Fumio Kishida has been trying to engage the EU-NATO countries in a joint confrontation with Beijing, emphasising that their security is "inseparable" from that of the Indo-Pacific region. American military support for Kishida is no longer enough.

The involvement of the EU-NATO countries in the confrontation with China is due to the same processes as Washington's shifting the burden of costs of the war with Russia to the EU. This is pushed by the objective reality of the weakening of the US. Although it has managed to strengthen its economy by squeezing Russian energy resources out of Europe, unscrupulous luring of promising firms from allied countries (from the EU to South Korea) across the ocean, and other extra-economic measures, this has not been enough. The US government is losing its financial stability.

Last week, the US Congressional Budget Office revised its projections for the US federal budget deficit. It anticipates the deficit to reach $1.9 trillion by the end of 2024, marking an increase of $0.4 trillion or 27% from its previous February forecast. Looking ahead to 2034, the estimated deficit is projected to grow to $2.9 trillion, exceeding February's forecast by $0.3 trillion. US government experts attribute these adjustments partly to increased military expenditures in support of other countries.

Presidents' last argument

The first consequences of the change in the balance of power in the world are already manifesting themselves in the West. Earlier this week, China was visited by none other than Andrzej Duda, president of perhaps the most pro-American country in the EU, Poland. Duda was once famed for a photograph of him standing in front of President Trump's desk, almost bowing obsequiously as he signed documents to establish a US military base in Poland. Now he was offering to help Beijing improve relations with the EU! At the same time, French President Macron, who recently threatened to send soldiers to war with Russia, said: "I believe in the power of dialogue, and I would continue it with Vladimir Putin."

But this hesitation in the collective West should not be misleading. Faced with a threat to its dominion, the Western establishment will resist to the last and will not give up using even the remnants of its military power - after all, guns are known to be the last argument of kings. A week ago in Washington, the NATO secretary general said that in the Russian-Ukrainian war, the US and NATO are confronting not only Russia, but also China, North Korea and Iran, and therefore NATO must go beyond Europe. Stoltenberg proclaimed: "Our security is not regional. It is global. What happens in Europe affects Asia, and what happens in Asia affects us... Everything is interconnected, and that is why we have to solve these problems together."

However, unlike previous rounds of Western plunder and conquest of the world, this time the military superiority of the collective West is not obvious.

Opinions expressed by guest columnists in their op-eds may vary and do not necessarily represent the views of the editorial staff.

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