South Africa is hosting the annual BRICS (Brazil, Russia, India, China and South Africa) Heads of State Summit in Johannesburg in August 2023, at which the group of nations is likely to ratify the memberships of several new countries.

We explore what is likely to be on the agenda for each BRICS member country and for candidates for membership:

South Africa

South Africa is likely to prioritize obtaining agreements, particularly with Russia, to mitigate its severe electricity shortages. South Africa is likely to seek to limit discussion of security issues at the summit, to avoid US perception that the country is backing Russia in its ongoing conflict with Ukraine.

Russia

The importance of BRICS has become greater for Russia since 2022. US and European sanctions have sharply curtailed trade between Russia and Western countries. Sanctions force Russia to seek new export markets and suppliers of critical technology and investors.

BRICS represents an important channel to achieve these goals, especially now that the body is looking to expand. Given the clear risk that Western sanctions will prove long lasting, Russia is likely to welcome the future accession of new countries to the BRICS group, especially if the additional members are aligned with it politically and/or distance themselves from the Group of Seven (G7) and other Western-led multilateral organizations.

Mainland China and India

Mainland China and India will probably use the BRICS summit as a platform for their similar but inherently competitive geopolitical strategies of promoting multilateral forums that focus more on emerging economies. Both countries see their role as serving as a potential bridge between advanced and emerging economies, especially from the 'Global South.' Accordingly, they will probably encourage BRICS to make tangible progress in expanding links with emerging-market countries.

The two countries support the expansion of BRICS and see potential for the forum to provide a platform for cross-national security coordination and development financing, in parallel with existing Western-dominated institutions such as the G7 and the International Monetary Fund (IMF). Neither mainland China nor India politically or militarily supports the Russia-Ukraine war, yet both governments are keen to develop a wider global consensus against Western-imposed multilateral sanctions — especially where these are perceived to damage their own development interests.

Listen to our podcast episode on India's global ambitions

Brazil

President Luiz Inácio Lula da Silva is pursuing a proactive foreign policy geared to enhance Brazil's global role and standing, focused on climate change, including combating deforestation and encouraging energy transition, and developing expanded multilateralism. Since Lula took office in January 2023, Brazil has increased its emphasis on engagement with the BRICS group of countries. The bloc provides a vehicle for deepening economic relations with mainland China, and serves to encourage multilateralism, a priority objective for Lula.

Brazil is likely to attempt to position itself as the leading representative of emerging market countries from the South. Brazil is still to specify its main goals for the BRICS summit. Based on discussions so far, these are likely to include the creation of a common currency and the facilitation of trade to reduce reliance on the US dollar, as well as strengthening the BRICS development bank, currently headed by former Brazilian president Dilma Rousseff.

Listen to our podcast episode on Brazil's political and economic outlook

Potential new members

Several states of the Middle East and North Africa (MENA) region are intent on securing BRICS membership. Algeria, Bahrain, Egypt, Iran, Saudi Arabia and the United Arab Emirates (UAE) have all submitted requests for membership of the body, and the Turkish government has expressed an interest in joining the group.

Although there are significant economic differences between them, there are overlapping interests in these countries' motivations to be included within BRICS. All would welcome opportunities for increasing bilateral trade in local currencies and reducing wider dependence on the US dollar. This is likely to be a much higher priority for import-dependent economies such as Egypt and Turkey and sanctioned economies such as Iran than for major hydrocarbon exporters Algeria, Saudi Arabia and the UAE. With hydrocarbon exporters continuing to price their oil exports in US dollars, even if they are willing to accept payment in alternative currencies, this makes it less likely that attempts at establishing a directly competitive BRICS currency will be effective.

For the Egyptian and Turkish governments, both experiencing significant economic and solvency issues, access to the BRICS group's New Development Bank (NDB) is likely to be a driver of seeking BRICS entry. They are likely to view NDB as a potentially viable alternative to engagement with the IMF and the prospect of the IMF requiring politically undesirable structural reforms as a condition for disbursement of funds.

Following Russia's invasion of Ukraine, multiple MENA governments, particularly in the Gulf, have intensified efforts to establish more-independent foreign policy positions, geopolitically less directly aligned with those of the US. BRICS membership would facilitate such policy orientation, as well as provide additional avenues to expand trade and commercial relationships and develop new business opportunities with Brazil, mainland China and Russia, while supporting initiatives within the Gulf Cooperation Council, notably in the UAE, to serve as a major international logistics hub.

Learn more about navigating geopolitical headwinds here

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.