The BRICS economic alliance is gearing up for what could be its most significant event yet—the 2024 annual summit. With the expansion of the bloc in 2023, which saw the United Arab Emirates (UAE), Egypt, Ethiopia, and Iran join, the group now comprises nine member nations. As anticipation builds for this year’s event, three major announcements are expected to reshape the global economic landscape.
1. BRICS Pay: A Game-Changer in Global Finance
The most awaited announcement is the official launch of BRICS Pay, a blockchain-based payment system designed to reduce reliance on the US dollar. After years of focusing on de-dollarization, BRICS Pay is set to revolutionize how the global south conducts bilateral trade by enabling transactions in local currencies.
This system is seen as BRICS’ answer to the SWIFT payment system, aiming to facilitate seamless trade among member nations and beyond. With Russia recently easing its restrictions on cryptocurrency use, many believe this new payment system is critical to future trade agreements within the bloc.
The timing couldn’t be more significant. Over the last six months, Russia’s trade with BRICS nations has increased by 14.7%, with a notable portion conducted in local currencies like the ruble. BRICS Pay is expected to be the centerpiece of the summit, solidifying the bloc’s efforts to diminish the dominance of the greenback in international transactions.
2. Further Expansion of the BRICS Bloc
Another major announcement expected at the summit is further expansion of the BRICS alliance. After its first expansion in over two decades last year, the group now has more than 30 countries expressing interest in joining, including Turkey, Venezuela, Nigeria, Malaysia, and Thailand.
While the current members are split on whether another expansion would benefit the bloc’s goals, the possibility of inviting more nations as partner countries, rather than full members, is under discussion. This approach could help BRICS grow its influence while maintaining control over its core decision-making process.
The expansion conversation remains delicate, particularly as Saudi Arabia, though invited, has yet to formally join the group. The outcome of this discussion will significantly shape BRICS’ global role moving forward.
3. The BRICS Bank: A Focus on Local Currency Loans
Finally, the New Development Bank (NDB), commonly referred to as the BRICS Bank, is expected to take center stage as it nears its 10-year anniversary in 2025. The bank has been a cornerstone of BRICS since its inception in 2015, providing developing nations with access to loans in local currencies. This focus aligns with BRICS’ broader mission of reducing reliance on the US dollar.
Earlier this year, the NDB welcomed Algeria as a new member and is expected to issue more than $5 billion in loans by the end of 2024. The bank’s role in promoting local currencies is expected to expand, with some experts predicting that BRICS Pay could be integrated into its operations, further bolstering the bloc’s financial independence.
Looking Ahead
The 2024 BRICS Summit is shaping up to be a milestone in the bloc’s history, with these three major announcements poised to reshape global finance, trade, and economic cooperation. The event is expected to continue the momentum from last year’s landmark decisions, solidifying BRICS’ position as a key player in the global economic order.
