BRICS, an alliance of emerging economies, has invited six countries to join their coalition, a move that intensifies the challenge the group poses to the West's economic dominance and the power of the dollar.
- BRICS has invited six new countries, including Saudi Arabia and Iran, to join the alliance.
- The new group will make up almost 42% of global crude oil output.
- With the added members, the enlarged group will have the heft to be able to trade in currencies other than the dollar.
The alliance, currently comprising Brazil, Russia, India, China, and South Africa, has invited Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates to join. The countries would become members beginning Jan. 1, according to the President of South Africa, Cyril Ramaphosa.
South Africa is hosting the 15th BRICS summit without Russian President Vladimir Putin, who is joining remotely because of an International Criminal Court warrant for his arrest. The main meeting agenda of the summit was the expansion of the group. This is its first expansion since South Africa was added in 2010.
Saudi Arabia, Iran, and UAE are all oil and gas exporters. With their admission into the BRICS group, countries in the alliance will account for almost 42% of global crude oil output. Such a grouping may opt to trade in currencies other than the dollar.
However, while other currencies may be used for trading, the U.S. dollar is peerless as a reserve currency due to its easy convertibility and credibility.
The expanded bloc will make up 37% of the world's GDP in terms of purchasing power and be home to about 46% of the global population.
Most BRIC members have complicated relationships with the West. The U.S. and China face commercial and diplomatic tensions, while Russia's invasion of Ukraine has alienated it from the West entirely. Iran faces sanctions over its nuclear programs and Saudi Arabia has been criticized for its human rights record.