Explainer: What Are the BRICS?

The BRIC acronym originally referred to the informal grouping of Brazil, China, India, and Russia. Goldman Sachs economist Jim O’Neill first coined the name in 2001, predicting that the four countries’ share of global GDP would increase significantly over the first decade of the century and would outpace growth of some of the world’s largest economies.

Over the next few years, foreign ministers from these four countries began to meet sporadically, first convening in 2006 during the sixty-first UN General Assembly in New York. These dialogues looked at ways the countries could cooperate politically.

Soon, though, talks turned to the economic crisis. As the 2008 recession hit U.S. and European markets, steady growth in China and India increased the BRIC countries’ confidence in weathering the slowdown. Oliver Stuenkel, professor at the Getulio Vargas Foundation in Brazil, wrote that the instability in developed countries juxtaposed with the relative strength of developing economies “caused a legitimacy crisis of the international financial order, which led to equally unprecedented cooperation between emerging powers.”

This cooperation came to light when BRIC finance ministers met in November 2008 in São Paulo, Brazil and released a communiqué detailing their commitment to work together in light of the financial crisis. That month, then Russian President Dmitry Medvedev and his Brazilian counterpart Luiz Inácio Lula da Silva agreed to arrange the first BRIC heads-of-state summit.

When China held the presidency in 2010, BRIC became BRICS when former Chinese President Hu Jintao wrote a formal invitation to South Africa to include the country in the group.

There have been 16 BRICS summits, hosted on a rotating basis in each member country. At each summit, heads-of-states meet to discuss BRICS-specific institutional goals, as well as general global political issues.

The last BRICS summit took place October 22-23, 2024 in Kazan, Russia. At the summit, member countries signed the Kazan Declaration, which condemned the use of “illegal sanctions,” introduced a new payments system, and called for the resolution of the conflicts in Ukraine and Gaza.

Stuenkel wrote in Americas Quarterly that the Kazan Declaration, as well as the inclusion of the bloc’s new members, are contributing to a sense that BRICS exists to serve as a counterpoint to the G7 or the West. Such sentiments were echoed in the speech of Russian President Vladimir Putin at the summit.

In the past, Brazilian leaders have pushed back against that language, suggesting that BRICS isn’t against any group and serves to foster South-South cooperation. President Lula did not travel to Kazan due to an injury and participated in the summit via video conference. However, Brazil will host the next BRICS summit in 2025. 

The 2024 Summit saw the full participation of BRICS’s four new members, who were invited to join the bloc at the 2023 BRICS Summit. Also invited into the bloc at that summit? Argentina.

At the time, then-President Alberto Fernández called the invitation a “great opportunity.”  However, in December of that year, newly inaugurated President Javier Milei, who critiqued the Chinese government during his campaign, announced that Argentina would not join the bloc.

Which other Latin American countries have indicated interest in joining the block? Bolivia, Colombia, Cuba, Ecuador, El Salvador, Nicaragua, Peru, and Venezuela have all had government officials express interest. At the 2024 leaders’ summit in Kazan, Cuba, and Bolivia were named “partner countries” of the bloc. With this designation, countries participate in BRICS initiatives and are on the track toward membership.

Despite the attendance of Nicolás Maduro, Brazil vetoed Venezuelan’s bid to get such a designation, due to concerns over the validity of the country’s July elections. In response, Caracas has pulled its ambassador from Brasília.

BRICS is not a formal organization, though has established institutions to carry out its shared values.  That includes a development bank, established at the 2013 presidential summit, that was envisioned as an alternative to the World Bank.

Leaders formalized this institution at the July 2014 summit, signing an agreement to create the New Development Bank (NDB). Located in Shanghai, the bank supports public and private projects through loans and bonds. By 2023, it had doled out $32 billion in funding for 96 projects across the five original member countries. 

Non-BRICS countries can join the bank, as Uruguay did in 2021.  In 2022, lending stopped to Russia, due to its invasion of Ukraine, but it has since returned. 

The rotating presidency of the bank is currently helmed by Brazilian ex-President Dilma Rousseff (2011-2016). She has set the intention to focus the bank’s financing on climate change mitigation.

Supplementing the NDB is the Contingent Reserve Arrangement—similar to the IMF—which establishes an initial reserve of $100 billion and acts as an emergency option for BRICS countries with balance-of-payment troubles. Much of the fund is provided by China, which contributes $41 billion. Brazil, India, and Russia, each contribute $18 billion while South Africa contributes $5 billion. 

Both these efforts seek to advance BRICS’s mission to move the world away from the dominance of the U.S. dollar. However, by 2022, even BRICS members continue to do the majority of their trades and foreign currency reserves in dollars. And though the NBD set an intention to lend more in local currencies, most loans have been in Chinese Renmibi. 

The dollar remains in use in almost 90 percent of global foreign exchange transactions and 58 percent of global disclosed foreign exchange reserves.

At the 2023 summit in Johannesburg, South Africa, Lula proposed to create a BRICS currency. At the 2024 Kazan summit, Russian President Putin called for the creation of an international payments system.  There is no stated time table for either idea.