By Farkhod Nazarov, undergraduate student at UWED, intern at IAIS
The expansion of BRICS in 2024 reflects a broader process of transformation of the global governance architecture. The transition to a new format is accompanied by intensified discussions on the formation of alternative centers of economic coordination and the redistribution of influence within the global financial system.
Under current conditions, the grouping is acquiring significance not only as a platform for dialogue among developing economies, but also as a potential instrument for the institutional reconfiguration of the Global South and the formation of a multipolar international order.
An additional factor increasing interest in BRICS is the turbulence of the international order and the changing nature of U.S. foreign policy. The return to a more confrontational and protectionist approach by the administration of President Donald Trump has intensified discussions on the need to diversify economic and political partnerships among countries of the Global South, which view the grouping as a channel for access to major Asian markets, primarily China and India.
Trade conflicts, sanctions policy, and threats of introducing tariff restrictions against a number of BRICS countries have underscored the vulnerability of states heavily dependent on Western markets and financial institutions. In these conditions, participation in BRICS is increasingly viewed as a tool for strategic “hedging” of risks and as a mechanism for expanding external economic opportunities. Thus, BRICS+ is beginning to be perceived not only as an economic club, but also as a potential alternative within a broader strategy of states aimed at reducing dependence on a Western-centric system of global governance.
However, along with promising indicators, problems also arise in the form of fragmentation of participants’ interests and coordination barriers, which point to the weak institutionalization of the organization. The central issue becomes the ability of BRICS+ to find a balance between converting economic mass into sustainable institutional power, on the one hand, and increasing transaction costs of coordination and risks of fragmentation, on the other.
As noted in expert studies, the expansion of BRICS opens new opportunities for economic growth and strengthening the grouping’s global influence. Key indicators point to a gradual deepening of economic ties within the bloc. Settlements in national currencies are expanding, and alternative payment mechanisms are being discussed, reflecting the participants’ desire to reduce dependence on the U.S. dollar. The New Development Bank, established in 2014, finances infrastructure, energy, and technological projects, forming a parallel development platform for countries of the Global South. In addition, BRICS countries have created a mechanism of mutual financial support — the Contingent Reserve Arrangement (CRA), aimed at stabilizing currency markets in the event of liquidity crises.
For reference: The pool of contingent currency reserves is a mechanism of mutual financial support for BRICS member states in the event of short-term liquidity problems and currency pressure. The total volume of the pool amounts to $100 billion. The distribution of contributions is as follows: China — $41 billion (41%); Brazil, Russia, and India — $18 billion each (18% each); South Africa — $5 billion (5%).
These steps indicate an attempt to redistribute monetary sovereignty, reduce transactional dependence on external financial infrastructure, and form a more pluralistic model of cooperation in the context of a gradual transition to a multipolar system of international relations. Institutionally, BRICS+ positions itself as an alternative to existing financial mechanisms, offering a less hierarchical model of coordination compared to institutions such as the IMF and the World Bank.
However, as experts note, alongside economic advantages, the expansion of BRICS has also intensified a number of structural problems within the bloc.
1.Limited institutionalization. Unlike integration associations with developed supranational architecture, such as the European Union, BRICS+ remains predominantly an intergovernmental platform without binding norms and enforcement mechanisms. The absence of a permanent secretariat, as well as the rotational nature of the chairmanship, makes the institutional structure of the grouping relatively flexible, but at the same time limits its capacity for long-term policy coordination. Under conditions of expansion, these institutional limitations become more pronounced, as an increase in the number of participants raises the complexity of reaching consensus. It is also worth noting that despite the creation of alternative financial instruments, the scale of their operations still significantly lags behind traditional institutions of global governance. For example, access to a significant portion of funds within the CRA mechanism remains linked to compliance with IMF conditions, indicating the continued dependence of new institutions on the existing financial architecture.
One of the most ambitious, yet still unrealized, directions of BRICS development remains the idea of a single currency or a common unit of account. Initially, discussions about a “BRICS currency” were actively conducted in 2023–2024; however, by 2025, the participating countries effectively abandoned rapid steps in this direction due to significant economic differences, lack of convergence of macroeconomic indicators, and political disagreements (in particular, India’s cautious position). Instead, the emphasis shifted to the creation of a unified system of settlements in national currencies.
This creates a kind of institutional paradox: while striving to reform the global governance system, BRICS does not yet possess sufficient resources and mechanisms to fully replace existing international institutions.
The main trigger of American pressure has been the policy of de-dollarization and the creation of alternative payment mechanisms. Washington views these initiatives as a direct threat to the global status of the dollar. At the same time, the United States continues to impose sanctions against Russia and Iran — key members of the bloc — and actively attempts to split BRICS through bilateral arrangements with individual participants.
One of the most striking manifestations of BRICS’ internal heterogeneity remains the asymmetry and complexity of bilateral relations between Russia and China — the two key “locomotives” of the grouping. As noted in expert studies, the mutual perceptions of the two countries differ significantly and largely determine the limits of their coordination within the bloc. China traditionally views Russia as an important, but increasingly dependent resource partner and a strategic counterweight to the United States, while in Russian elites there remains caution regarding the growing economic and technological power of Beijing. Historical legacy (from China’s “century of humiliation” to the Sino-Soviet split of the 1960s) and contemporary disproportions (China accounts for 70% of BRICS GDP, dominance in trade and investment) create an implicit hierarchy that is only masked by the official rhetoric of “limitless partnership.”
This asymmetry is particularly evident in Central Asia — traditionally a zone of Russian interests. China, through the “Silk Road Economic Belt” initiative and subsequent infrastructure projects, is actively expanding its economic presence, turning the region into a corridor for its energy resources and goods. Russia is trying to maintain political and cultural influence through the EAEU and the SCO, but objectively lags behind Beijing in financial and investment capabilities. Although the sides avoid open confrontation and adhere to an implicit “division of roles” (Russia — security, China — economy), the growing dependence of Moscow on the Chinese market and technology intensifies internal contradictions within BRICS. This not only complicates the development of a unified agenda on de-dollarization and alternative payment systems, but also demonstrates a broader problem of the bloc: even among its closest partners, structural imbalances persist, which hinder deep integration and increase the risks of fragmentation.
An equally serious source of disagreements within BRICS is the rivalry between China and India for influence in South Asia — a region where the interests of the two largest members of the bloc directly collide. India traditionally perceives South Asia as its sphere of influence (“Neighborhood First”), however China, through large-scale projects within the Belt and Road Initiative, is actively displacing its positions. China is developing port infrastructure (Gwadar in Pakistan, Hambantota in Sri Lanka, Chittagong in Bangladesh), military cooperation with Pakistan and Myanmar, and providing significant loans and investments, which leads to a “debt trap” for a number of countries in the region. As a result, India views Chinese activity as a direct threat to its national security, especially in the context of territorial disputes and competition in the Indian Ocean. This competition directly affects the functioning of BRICS, complicating the achievement of consensus on key issues.
Another acute manifestation of BRICS’ internal heterogeneity has been the deep contradictions between Iran and the Gulf states (Saudi Arabia and the UAE). The Sunni–Shia divide, long-standing proxy conflicts in Yemen, Syria, and Lebanon, as well as rivalry for leadership in the Islamic world and control over energy routes, make these relations one of the most explosive within BRICS. This confrontation is also clearly manifested in the current escalation of military actions by the United States and Israel against Iran.
Thus, even among the key players of BRICS, structural imbalances and geopolitical contradictions persist, turning the grouping into a platform where internal disagreements often prevail over economic cooperation and hinder deep integration.
The future effectiveness of BRICS+ will depend on possible directions of institutional development of the grouping, in particular:
In general, it can be noted that BRICS+ demonstrates significant geo-economic potential and is gradually strengthening its position in the global economy. However, the ability of the grouping to transform quantitative growth and economic mass into sustainable institutional power remains limited. If BRICS does not resolve the problem of institutionalization, does not develop mechanisms for managing internal contradictions, and does not create more effective instruments for coordinating economic policy, the grouping risks remaining primarily a platform for political dialogue. In this case, the prospects for forming an alternative model of global governance may prove limited, and BRICS+ will retain the role of a flexible but institutionally weak association of states united more by common interests than by deep integration.
* The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.
