Positive Philosophy of BRICS

19.07.2018

The main value that unites the BRICS countries in these difficult times of the economic disorganization and the political uncertainty is their development, said the Maksim Oreshkin, Russian Minister of Economic Development. On July 19, 2018, he took part at the Valdai Club expert discussion, titled “New Centers of Development and Their Role in the Economic Progress of the World”, which was organized on the eve of the BRICS summit in Johannesburg.

In recent years the world economy remains in a constant state of turbulence. On the one hand, there are trade wars and the rise of protectionism (the USA against the EU/China), crisis of world trade and conflicts inside the largest blocs (for example, G7). But on the other hand there are agreements like the EU-Japan free trade zone, new opportunities for alternative regional and global blocs - such as the SCO, EAEU and BRICS, which became the main subject of conversation. According to Fyodor Lukyanov, research director of the Valdai Discussion Club and moderator of the discussion, the previous economic system is now experiencing not just restructuring but deconstruction - and initiators of this process are those who built it. For BRICS this situation is a "window of opportunity". Now it can proclaim itself as a competent union of countries, which has something to offer to the world.

Maksim Oreshkin recalled, that the first BRICS summit took place almost 10 years ago, in 2009. Since then much has changed: if the first format seemed strange, now this association begins to play an increasingly important role in the world. Its total GDP volume has already exceeded the G7 indexes. Therefore, the upcoming BRICS summit in Johannesburg (South Africa) will gather the largest growing economies of the world.

The minister stressed, that although the BRICS countries have different positions on a number of issues (for example, electronic commerce and investment regulation), in general they present a united front: protectionism is inadmissible, trade must be free, it is necessary to maintain the format of big blocs.

The agenda of the previous BRICS discussions was mostly the world trade. Today, there is an intensive development, deepening of relations within the bloc itself. This concerns, for example, Russia's relations with China. And this topic is likely to be discussed in Johannesburg on July 25-27. Moreover, according to the minister, at the forthcoming summit one can expect discussions about the fourth industrial revolution (Industry 4.0), the need to move away from pure production in favor of own products, with the surplus value increase and direct focus on companies. Among other possible topics in Johannesburg could be digitalization, inclusive society, development with an emphasis on prosperity.

Nine African countries are invited to the summit, and discussions with them in Johannesburg will be also very important. "The Russian economy will be compatible with the demand that is actively growing in African countries," the minister said and stressed, that in terms of its potential Russia's cooperation with the African countries looks very promising for the next 10-15 years.

Fyodor Lukyanov drew attention to the fact, that in comparison with the G7 in terms of GDP BRICS is now in more favorable position, but its impact on the world financial system it is much inferior to the G7. Maksim Oreshkin objected. According to him, the situation is changing.

For example, the conflict with the United States can even play in Russia's favor: today an increasing share of trade is paid by the national currency, large holdings and banks are re-registered, domestic markets and bilateral cooperations are growing, and interaction with non-Western banks is developing. As for the PRC, earlier, when relations between China and the US were in general good, the Chinese were very careful about the anti-Russian sanctions, and now, when Washington declared trade war against China, everything looks different. Of course, the BRICS countries need greater independence and multipolarity. In the last two years the financial system inside the BRICS and between the BRICS countries is beginning to develop more actively.

Questions from the audience touched on various problem areas. whish exist both within BRICS and in its relations with other actors. Critics of the bloc noted, that China wants to play the "first violin", so that all the accepted documents reflect only the interests of Beijing. However, Maksim Oreshkin did not agree with this opinion. "All BRICS countries are on the same side in world trade,” he said. - We will come to a situation, where multipolarity will be not only in politics, but also in the economy. Despite the fact that China is growing, and the more it grows, the more it will face internal economic problems, it is unlikely that it will be able to take such a domination position - especially inside the BRICS." Moreover, today’s agenda is the cooperation of the bloc with a number of other countries, which together form BRICS +. Specific goals and objectives are different, but the common interest is development”.

On the basis of this idea the minister formulated the answer to another question - what makes it possible to present the BRICS as a single structure with a common potential?   "I would mention one value that unites the BRICS countries - this is development ... History of development, which unites the BRICS countries, allows them to communicate and formulate positions," Maksim Oreshkin said.

"We are not "against" anything, we are" for", - this is another simple formula. According to Fyodor Lukyanov, it perfectly suits to determine the "philosophy" of the BRICS.

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