Geopolitical Diary: The Birth Of BricJune 18th, 2009
The leaders of Brazil, Russia, India and China — the “BRIC” countries — met in Yekaterinburg, Russia, on Tuesday. It was BRIC’s first formal summit (the next is scheduled for 2010 in Brazil), and the leaders issued a predictably vague communiqué urging a greater role for developing nations in international institutions. Though the group’s first summit could be construed as a sign of growing cohesion, the reality is that BRIC’s origins are far from organic. The ties that bind these countries together are not nearly as strong as the forces that pull them apart.
The countries that form BRIC never sought to be lumped into a formal organization. The four countries have been together in a theoretical bloc since 2001, when a Goldman Sachs analyst identified them as potential economic powerhouses. At the time, the BRIC countries together comprised 7 percent of global GDP — and true to predictions, that percentage has more than doubled since then. This has generated a lot of attention, but the leap from identifying these states as four economically potent countries to the formation of a meaningful multilateral bloc is a difficult one to make.
Much of the hype surrounding BRIC stems from the notion that an alliance of medium-sized economies could lead to a serious attempt to counterbalance the United States. Although this would be intriguing, each of the BRIC states has a very different relationship to the United States, the world and each other. Whereas Russia has every interest in tweaking the United States’ tail, China relies heavily on U.S. consumer demand to fuel employment. India and Brazil both have complicated, hot-and-cold relations with the United States, but neither is looking to alienate the world’s largest economic and military power.
Even for the sake of multilateral relations, there are political and economic challenges to any kind of solidification of the BRIC bloc.
China’s fundamental focus is on maintaining centralized control over its territory, which is riddled by divisions between rural and urban populations and disparate regions. The central government’s overriding concern is to keep employment and job creation high, in order to ward off political unrest. Economic growth has become the government’s primary means of securing legitimacy, and rapid development requires access to strategic commodities. Thus, any partnerships China pursues will fit with its economic needs. In the context of the BRIC nations, this means that whatever trade relationships China strikes up — such as the growing relationship with Brazil or investments in Russia’s energy sector — will be based chiefly on commodities, not any deeper economic integration. Most states (include China’s BRIC partners) simply lack the consumer market to which China requires access.
India is similarly unable and uninterested in solidifying relations with its fellow BRIC states. Serious economic linkages and partnerships are difficult for India to forge, given its inefficient bureaucracy and protectionist tendencies. Furthermore, India’s geopolitical position — as the predominant power in the Indian Ocean — means that it is able to maintain an independent foreign policy and is inherently unwilling to tie itself to any foreign power.
For Russia and Brazil, the concept of a BRIC coalition offers more opportunities.
For Russia, this particular moment in history is a time of great opportunity. With the U.S. military tied down in two theaters and Moscow holding enormous cash reserves, Russia has an opportunity to expand its influence in Eastern Europe and Central Asia for the first time since the end of the Cold War. The presidential turnover in Washington has made 2009 a particularly important time for Russia, which seeks to impress its rising-power status on the new administration. To this end, Russia is hosting a flurry of meetings this week (of which the BRIC summit was only one), moving to solidify its position ahead of President Dmitri Medvedev’s meeting in July with U.S. President Barack Obama. The BRIC summit, therefore, provides another forum in which Russia can position itself politically. But this benefit to Russia hardly meets the stated purpose of the group.
Among all of the BRIC states, it is Brazil that may have the most to gain from a coalition. Though Brazil is nearly as entangled in its own domestic challenges as China, it has begun to turn its eyes toward increasing international involvement. After little more than a decade and a half of responsible fiscal governance, Brazil has begun to assume an outward-looking perspective. This is aided in part by Brazil’s growing stable of powerful corporations — ranging from state energy firm Petroleos Brasileiro to private mining giant Vale — that serve as both a driving force for Brazil’s international expansion and as ambassadors for investment and technological cooperation. For Brazil, BRIC (along with alliances like IBSA, its partnership with India and South Africa) offers a forum for building bilateral relationships. But even for Brazil, the benefits of BRIC do not have a multilateral bent.
Perhaps the fundamental impediment to any kind of solid BRIC coalition is geography. Brazil’s position, on the other side of the planet from its fellow BRIC states, makes trade expensive and time-consuming, and provides an incentive for seeking partners closer to home in the long run. For Russia, China and India, there is a long history of uneasy alliances and outright rivalry generated by their geographic proximity and strategic competition — making an alignment of the three states based merely on economic strength an unrealistic concept.
In the end, the BRIC summit (and those that will follow) is a way for these states to touch base on immediate bilateral concerns, but it does not signal a move toward a greater multilateral reorientation.
18th June 09