Talking about world economic power, there are several economic blocks or alliances involving many countries. Related to that, one of the strongest alliances or blocs is BRICS.
BRICS is an abbreviation for “Brazil, Russia, India, China, and South Africa”. BRICS is a group of five countries that work together on a variety of economic, political, and social issues.
BRICS was founded in 2006 with the aim of promoting economic cooperation between members, discussing global issues, and influencing fairer global governance.
One important aspect of BRICS cooperation is efforts to increase the role of developing countries in the international financial and economic system, as well as speaking with one voice on geopolitical issues.
So, to better understand what BRICS is, its mission, goals, functions, how it differs from other organizations such as the G20, countries that want to join, and its influence on Bitcoin, see the full review below.
Get to know BRICS Mission and Goals
Currently, BRICS has become an important platform for its member countries to discuss, coordinate, and enhance their cooperation on various global issues.
One of the main goals of BRICS is to increase economic cooperation between its member countries. BRICS seeks to facilitate trade, investment, and sustainable economic growth between them.
In addition, BRICS is also trying to play a more significant role in global governance.
This economic bloc wants to influence global policy, especially in terms of reforming international institutions such as the UN and IMF (International Monetary Fund), to reflect changes in the economic and political realities of a more balanced world.
Apart from economic issues, BRICS also discusses political and security issues, including world peace, stability, and conflict resolution.
In addition, BRICS has a strong focus on sustainable development and seeks to address challenges such as poverty, inequality, and climate change at the global level.
The following is a brief overview of the countries that are members of BRICS, namely:
- Brazil (Brazil): The largest country in South America and one of the largest economies in the world and is famous for its natural resources.
- Russia (Russia): The largest country in the world geographically. Russia has great military power and natural resources.
- India: The country with the second largest population in the world. India has a rapidly growing economy and is a technology and services hub.
- China: The country with the largest population in the world and the second largest economy after the United States. China is a leader in global trade and has rapid economic growth.
- South Africa (South Africa): A country at the southern tip of the African continent that has a significant economy and diverse natural wealth.
BRICS Functions and Objectives
It should be noted that BRICS has a major role in the world of geopolitics and economics, which includes several key aspects. In the field of geopolitics, BRICS is a group of developing countries that have a common voice on global geopolitical and economic issues.
BRICS seeks to advocate for common interests and supports similar positions in international forums such as the UN. One of BRICS’ main roles is to encourage reform of international institutions such as the UN, IMF and World Bank.
BRICS seeks to ensure that the system reflects changing economic realities and gives developing countries a greater voice. Apart from that, BRICS also seeks to play an important role in global diplomacy, especially in resolving conflicts and maintaining world peace and stability.
In the economic field, BRICS is a large economic group in the world, and their cooperation aims to promote sustainable economic growth among its members. BRICS seeks to increase trade, investment, and economic collaboration.
BRICS also works together to address trade, financial, and currency issues. BRICS seeks to reduce dependence on foreign currencies and increase trade in their national currencies. In addition, one of BRICS’ goals is to increase infrastructure development, especially in developing countries, to support economic growth and regional connections.
Meanwhile, the aim of BRICS cooperation in the economic field is to increase trade cooperation, investment, and sustainable economic growth among its members. BRICS also tries to play a role in global financial issues and the reform of international financial institutions.
In the political field, BRICS wants to influence global political policies and contribute to world peace and stability. BRICS seeks to address geopolitical challenges through dialogue and diplomacy. On the other hand, in the social field, BRICS is committed to overcoming social problems such as poverty, inequality, and climate change. BRICS strives to improve the quality of life of its residents and support sustainable development.
Differences between BRICS and other organizations such as the G20
Basically, BRICS and G20 are two groups that play a role in global governance, but they have differences in terms of composition and scope of their respective goals. BRICS itself is a group consisting of five large developing countries, namely Brazil, Russia, India, China, and South Africa. This group consists of countries with significant and rapidly developing economies.
Meanwhile, the G20 is a forum consisting of 19 member countries, including developed countries such as the United States, Germany, and France, and developing countries such as India and China, so that the G20 is more diverse in terms of the composition of its members.
In addition, BRICS focuses on cooperation between its member countries, with special emphasis on economic and geopolitical issues that are relevant to them. The main goals of BRICS are to promote sustainable economic growth, reform of international institutions, and geopolitical diplomacy.
On the other hand, the G20 is broader in its scope of objectives. The G20 is a forum for talking about global economic issues, including finance, trade, and macroeconomic policy. Apart from that, the G20 also discussed issues such as climate change, gender equality and education.
It is important to underline that BRICS and the G20 have several members in common, such as India, China and Russia, which allows them to interact and complement each other in several ways. In terms of economic cooperation, for example, both the BRICS and the G20 focus on global economic issues. BRICS member countries frequently discuss economic policy in G20 forums, allowing them to contribute to collective thinking and action on economic issues.
In addition, the BRICS countries in the G20 have greater joint influence in formulating global economic policy, especially as their economies develop. On the other hand, BRICS can also use the G20 as a platform to promote their goals in geopolitical diplomacy and reform of the international system.
Who are the countries that want to join BRICS?
To date, a number of countries and entities have shown interest or have been invited to become members of BRICS even though they have not officially joined. Some of them are Türkiye, Argentina and Egypt. Türkiye itself has expressed interest in collaborating more intensively with BRICS. With its strategic position on the border of Europe and Asia, Turkey can bring valuable contributions to BRICS relations with Europe and the Middle East.
Then, there is Argentina which has also participated in the BRICS meeting as a guest and shown interest in becoming a full member. Argentina wants to take advantage of opportunities for economic cooperation with BRICS countries, especially in trade and investment. On the other hand, Egypt has also expressed its interest in joining BRICS as a full member. With its position in the Middle East and long history in international diplomacy, Egypt can help expand the BRICS’ geopolitical reach.
In addition, according to a statement from the Chair of the 2023 BRICS Summit from South Africa, more than 40 countries have expressed interest in joining the BRICS forum, including Iran, Saudi Arabia, United Arab Emirates, Algeria, Bolivia, Indonesia, Ethiopia, Cuba, Democratic Republic of Congo , Comoros, Gabon and Kazakhstan.
These countries are interested in being part of BRICS for several reasons, among which joining BRICS will provide access to large and developing markets that can increase trade and investment for these countries.
Additionally, as BRICS members, these countries can have greater influence on geopolitical issues and reform of international institutions.
In addition, BRICS is a strong economic cooperation platform so joining this group will be able to help these countries deepen their economic cooperation. BRICS also includes cooperation on global security issues and countries wishing to become members can seek benefits in terms of security and stability.
BRICS Issuing a New Currency?
To date, BRICS has indeed expressed interest in creating an alternative currency or payment system that is independent of dominant world currencies such as the United States Dollar (USD). However, concrete steps in issuing new or alternative currencies have not been implemented.
Basically, one of the main goals in creating a new or alternative currency that will be carried out by BRICS is to reduce dependence on the USD in international trade and global finance. This can help reduce economic risks associated with USD exchange rate fluctuations.
In fact, BRICS’ steps to create an alternative currency may face challenges and resistance from other countries, especially countries that have an interest in maintaining the hegemony of the current world currency, namely the USD. Among the impacts are value fluctuations. As BRICS alternative currencies emerge, value fluctuations may occur, and this may affect global financial and economic stability.
Additionally, if the BRICS alternative currency is successfully implemented and widely accepted, it could increase BRICS influence in the global financial system possibly changing global economic and political dynamics. Furthermore, BRICS efforts to create alternative currencies will require strong international cooperation, including with countries outside the group. Intense negotiations and diplomacy will be necessary to achieve this goal.
Get to know the influence of BRICS on Bitcoin
So, how does BRICS affect the price correlation of the Bitcoin crypto asset? It is important to note that BRICS does not depend on the demand for USD so it will not affect the demand for the USD exchange rate, which could ultimately reduce the value of the currency.
The price of Bitcoin has a significant correlation with changes in the value of the USD. When the USD strengthens, the price of BTC tends to fall, while when the USD weakens, the price of BTC tends to rise.
For example, in September 2022, the USD strengthened by around 15% against other currencies. However, on April 10, 2023, the USD strengthened only about 2.2%, which can be considered an almost insignificant change against other currencies.
Additionally, a decrease in demand for USD could also have a direct impact on the price of BTC, considering that many crypto trading pairs use stablecoins whose value is closely tied to USD.
Meanwhile, according to the publication Coinmarketcap, the influence of BRICS currencies against the US dollar could result in dedollarization, which in turn could strengthen Bitcoin’s role as a digital commodity and a more significant alternative hedging tool.
In conclusion, BRICS is a group of large countries with strong economies and influence in global governance. The existence of BRICS has several important aspects, including (1) economic strength, (2) reform of the international system, (3) geopolitical cooperation, and (4) influence on world currencies.
BRICS itself continues to have the potential to play an increasingly important role in the international world. Some of the group’s hopes and prospects for the future include (1) increased economic cooperation, (2) reform of the international system, (3) peace and stability, (4) alternative world currencies, and (5) expansion of members.
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