In 2001, Jim O'Neill of Goldman Sachs put out what the firm termed a “game-changing paper” on the economic performance of four countries in 2000, the first year of the new millennium. The combined GDP (in US$ on a PPP basis) of Brazil, Russia India and China, he found, added up to 23 per cent of world GDP. China had overtaken Italy, and O'Neill and predicted that their cumulative weight would force the G7 to include them in future deliberations; equally, their fiscal and monetary policies would impact the global economy in keeping with their rising economic importance.
An acronym as entity
He coined the acronym ‘BRIC' and did Russia and Indian policymakers an immense favour by handing them what they would consider a bargaining chip for greater intervention in a messy, but hegemonic world order.
From an accident of history that resulted in these countries reaching somewhat similar levels of GDP at around the same time and for entirely unrelated reasons, to a deliberate belief in their consensual power to change the existing world order seemed a rather appropriate conceptual leap.
After all, economic strengths create and fortify ‘superstructure' strengths, so went the belief. And the idea that BRICS could be erected as a formidable alternative, strategically and economically, to perceived Western domination was increasingly seductive, especially for Russia yearning for superpower status once again. For India, the temptation lay in the possibility of recovering strategic ground in the global space, lost since 1984, and in the relief that it was still standing among the ruins of the global crises.
No member of that acronym striving to morph a linguistic convenience (for that cartographer of global economic trends on Wall Street) into a “game changing” reality, ever defined just what that formation-waiting-to-be-born would really do. Perhaps history would be kind and permit a European Union-type formation; after all if its core group in Western Europe, sharing economic prosperity, could evolve into a pan-continental conglomerate, so could BRIC.
So, when South Africa was admitted last year, it seemed like a good augury: its membership turned a BRIC into BRICS. And an agenda was taking shape. Inchoate at best, confused at worst, that agenda of an idea waiting to acquire a life, reflects divisive self-interests, hidden power play, and signals all the reasons why the idea may remain still-born.
For Russia and China, the singular advantage of BRICS is, so they think, the platform it provides to fire westward at the dollar and American hegemony. That is why both at the 2010 annual meeting and in China last year, the issue of a movement away from the dollar acquired urgency. In 2010, Russia and China agreed to engage in non-dollar denominated bilateral trade.
So, in China last year BRICS leaders were urged to follow suit but settled for further discussion on the subject. For India, the idea of BRICS offers it the seductive opportunity to simply grandstand; in India history plays tricks, and fools policymakers into believing a unique opportunity to provide statesmanship has come its way.
Reaching for alternatives
The Non-Aligned Movement (NAM) was based on weak economic performance, but a shared ideological vision. Now, policymakers assume,that economic power automatically leads to strategic power. Where NAM's intervention simply exacerbated global divisions (perhaps because it grew out of them) BRICS would heal an endemic disease by reassuring it of India's commitment to the WTO, to balanced multilateral trade, sound economic governance. India would like to reorder the current equations through the demonstration effect of its own exemplary behaviour and economic performance.
Russia and China want an agenda of war against the dollar. This year India hosts BRICS leaders and the agenda is all about the Doha Round and WTO and multilateral trade, and commitment to its balanced and purposive conclusion.
Both viewpoints may help turn an acronym into a metaphor at best, a simulacrum of life but hardly one that can provide a tangible platform to stand on and aim for “game-change.” Yet, the temptation to recreate the world by creating an alternative regional formation, however syncretic, cannot be resisted.
BRICS, it is now said, is already increasing trade among its members, with Russia Brazil and South Africa supplying raw materials to India and China. The composition of trade perhaps is meant to indicate competitive strengths but if history is a guide and should such trade flows increase, one may expect yet another metaphor from the past — neo-colonialism- —to acquire a life of its own.
Formations galore
The dangers of still-birth for BRICS are real, because regional formations all over are in crises. The most successful one is in danger of imploding just like an unrelated ancestor, the Hapsburg Empire, did almost a hundred years ago, simply because it was too unwieldy and held together by an idea whose time was out of joint. Decentralisation haunts Europe as it did the Dual Monarchy a hundred years ago; like then, economic crises may push the EU's centre into petty nationalism.
Growth itself has become decentralised. Just as the BRICS countries constituted an alternative centre to growth it is possible new ones will proliferate from the strangest of corners. Map-makers are busy discovering new ‘archipelagos'. Recently “CIVETS” was pronounced as a new growth ‘agglomeration.' Its constituents, Columbia, Indonesia, Vietnam, Egypt and South Africa, spread across the world with blatantly obvious differences may yet be tempted to consider the option of contributing to the babble of hollow voices now ringing around the world.
But the cartographer plays fair in his game of discovery: “PIGS” now stand for the dark underbelly of growth and one may be rest assured that Portugal, Ireland, Greece and Spain will not be seduced enough to attempt a club of the heartbroken.
Yet the urge to give body to an acronym via the wayward stations of the metaphor will not cease, despite O'Neill's cautionary on India pulling down BRICS growth. For hadn't Isaac Babel said: “A well devised story need not be like real life. Real life itself would like to be like a well-devised story”.