Five themes to watch at BRICS 2017

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BRICS – the five-nation grouping of emerging economies – has swayed from highs to lows over the past decade, but is now reclaiming its position as a powerful global voice with fast-growing markets.

With five extra countries invited to join the BRICS Summit 2017 in China and the backdrop of simmering tensions on the Korean Peninsula, what will be the key themes when world leaders gather in Xiamen from September 3-5?

Rejuvenated BRICS

BRICS is back! That is likely to be the underlying message of the three-day summit: The Chinese and Indian economies are continuing to grow rapidly, Brazil is rebounding from the recession, and Russia’s diversification away from oil is encouraging investors after a difficult two years for its economy. South Africa's economy is struggling, but investment in the country continues.

Chinese President Xi Jinping presides over an informal leaders' meeting of BRICS in Hamburg, Germany, July 7, 2017. /Xinhua Photo

At an informal meeting of BRICS leaders on the sidelines of the Hamburg G20 Summit in July, Chinese President Xi Jinping noted that the global economy is showing some positive signs and BRICS countries are enjoying brighter development prospects.

Goldman Sachs, where the BRICS acronym was coined in 2001, closed its related investment fund in 2015 after a slump in asset value but has now returned to the emerging markets. Jim O’Neill, the economist who came up with the acronym, continues to insist the rise of emerging-market consumers, led by China’s middle class, is the key mover in the world economy.

China was the largest trading partner for the grouping's other four members last year, and the promotion of a globalization that works more fairly is likely to feature prominently at the China-chaired summit.

The summit will also include the first BRICS business leaders’ forum, an opportunity for leaders of industry to exchange ideas and forge new partnerships.

The shadow of Trump

The Xiamen summit will be a rare international event where the US president is NOT the center of attention – but his agenda is likely to be an important subtext.

From global trade and governance to climate change, the BRICS direction of travel is not in step with that of the Trump administration.

US President Donald Trump won't be in Xiamen, but the impact of his agenda is likely to feature‍. /AFP Photo

Chinese Minister of Commerce Zhong Shan warned against trade favoritism at a meeting of BRICS trade ministers in early August, a sentiment likely to be repeated in Xiamen.

“Safeguarding the multilateral trade system and rising against protectionism serve the common interests of emerging and developing economies,” Zhong said.

Global affairs

When world leaders gather, the headline issues of the day are never far from the surface, no matter the official agenda.

Brazilian President Michel Temer, Russian President Vladimir Putin, Indian Prime Minister Narendra Modi, Chinese President Xi Jinping and South African President Jacob Zuma pose for a group photo during the BRICS Summit in Goa on October 16, 2016. /AFP Photo

No international summit is complete without the intrigue of “on the sidelines” meetings between world leaders, and with 10 expected to be in Xiamen, developments from bilateral talks will be hotly anticipated.

The China-India Donglang standoff was resolved ahead of the summit, and Indian Prime Minister Narendra Modi has confirmed he will join President Xi in Xiamen, along with Russia’s Vladimir Putin, Brazil’s Michel Temer and South Africa’s Jacob Zuma.

The DPRK's latest missile launch is likely to feature in bilateral talks at BRICS 2017. /AFP Photo

In a week in which the DPRK launched a missile over Japan – adding to a series of such tests over recent months – brewing tensions on the Korean Peninsula will be in focus over the coming days.

Xi emphasized the importance of multilateralism and making full use of organizations such as the UN when addressing BRICS leaders in July, and in the wake of the latest DPRK missile test this message is likely to be reiterated.

The subject will no doubt feature in bilateral talks, but countries are likely to stand behind the response of the United Nations.

Building BRICS

BRIC became BRICS, and in Xiamen BRICS becomes BRICS Plus for the first time. Whether this will be a regular feature or a one-off is unclear, but the decision to invite Egypt, Guinea, Mexico, Thailand and Tajikistan is a signal of the grouping’s determination to be inclusive – what Russian ambassador to China Andrei Denisov termed China’s “global approach”.

Mexican President Enrique Pena Nieto will attend the BRICS 2017 Summit as part of the "plus five“ group. /AFP Photo

When chairing a meeting of foreign ministers from the BRICS nations in Beijing on June 19, Xi stated that cooperation between BRICS countries is about establishing new partnerships based on mutual respect rather than the mindset of zero-sum games.

Speculation that BRICS could be expanded with additional permanent members has been played down, but China’s invitation to five extra countries to attend is a signal of inclusivity and the desire for emerging economies to have a mechanism available to speak with a shared voice.

BRICS, Belt and Road

Inclusivity is also key to the China-led infrastructure and trade program, the Belt and Road Initiative. Several attendees are involved in the project, and where interests coincide, more alignment with BRICS countries is probable.

Chinese President Xi Jinping (R) and Russian President Vladimir Putin (L) at the Belt and Road Forum on May 15, 2017. They will meet again at the BRICS Summit in Xiamen. /AFP Photo

The Belt and Road mechanism has already been aligned with multiple domestic agendas, including Saudi Arabia’s “Vision 2030”.

The similar objectives of the BRICS New Development Bank and the Asian Infrastructure Investment Bank regarding the promotion of trade and a focus on people-to-people exchanges are likely to be highlighted.

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