GGN: The growth of BRICS and the geoeconomics of Latin America

While the 16th BRICS Summit is taking place in Kazan, Russia, our continent is (closely) watching the expansion of the bloc as a way to escape the limited possibilities of presence in the International System through the simple validation of the “West”.
Let’s explain, and the country’s own dubious role reflects this.
If national foreign policy were concentrated in the Itamaraty (Itamaraty is generally used as a metonymy for the Ministry of Foreign Affairs), the entire agenda of the ministries beyond their borders would be coordinated by Chancellor Mauro Vieira, special advisor Celso Amorim and a group of higher-level advisors.
This special advisory body could have a collegial existence, but it must necessarily be decisive.
Today, if something like this exists, it is for consultation and not for decision-making.
The Finance Ministers (Fernando Haddad) and Simone Tebet (Planning) did not travel to Russia, but to the United States, in compliance with the agenda of the IMF, the World Bank and also the G20.
The other concern is the resumption of the investment grade, the maximum rating from the “risk analysis” agencies, or the blackmail organized by Moody’s, Fitch and Standard & Poor’s.
Anyone who remembers the maximum rating given by the “analysis” companies to both Bear Sterns in March 2008 (two weeks before the fraudulent bankruptcy) and Lehman Brothers (in the same situation, going bankrupt through fraud in September 2008) knows how much this rating is negotiated.
The BRICS bloc, in theory, would be (and is) the great opportunity at this moment in the world economy for countries to free themselves from this constraint.
Brazil has its productive capacity, public finances and income distribution policies hijacked by speculators and blackmailers from the financial casino.
Our trade flow is very intense towards Asia (in general) and China (in particular).
We can continue doing this “forever”, exporting commodities through a transnationalized value and supply chain (such as inputs, poisons and transgenic seeds) and paying endless royalties.
Or we can try to allocate – overlap – little by little the trade flow mirrored in the financial one and expand international exchanges outside the dollar standard.
At another time, not too far away – not at all far away, in fact, depending on the investment capacity of the New Development Bank (NDB, nicknamed the BRICS Bank) – the bloc and Brazil may establish or expand new value chains; The case of Bolivia is striking.
The country is experiencing a dollar inflow crisis precisely because its productivity in the production of energy commodities is lower.
YPFB (the country’s equivalent to Petrobrás), under the control of the central government since its renationalization in May 2006, financed the national economy (the fastest growing and most stable for 15 years) and now needs reinvestment.
One solution: YLB, the state-owned lithium company associated with a Chinese company and developing high-performance batteries and a complex medicine center.
The investing capital is Chinese (and also Russian), but we could have a South American lithium consortium co-financed by the NDB.
There are many examples, as well as the challenges of Latin American development and sovereignty, considering the weight of the hegemonic US empire among us.
BRICS, China and financial architecture
The three-day event (October 22-24) is attended by up to 36 countries, 24 of which are represented by the top leadership.
The expansion of the bloc also implies counterbalancing the enormous weight of the second largest economy on the planet.
In 2022, China represented almost 70% of the bloc’s accumulated GDP.
Thus, the expansion was (and is) a necessity, to assert the position of those under direct sanctions by the United States (and NATO), which exercise absolute control over the Swift System and, by extension, the international trade insurance system through the use of the US dollar.
Russia, China, India, Brazil and South Africa are present at the 16th Conference.
Egypt, the United Arab Emirates, Ethiopia and Iran are also attending the meeting.
The other new members accepted in 2023 did not fully join.
Argentina backed out of its decision, in yet another stupidity by the Javier Milei government.
Saudi Arabia, on the other hand, remains recalcitrant, still “analyzing” the possibilities.
Türkiye, Belarus, Armenia, Kazakhstan, Mongolia, Congo, Vietnam and Laos are in Kazan with high-level delegations.
From Latin America, in addition to Brazil, we have Bolivia, Venezuela and Cuba.
A list of “partner” countries, a sort of second-tier alliance (without veto power) will emerge from the conference, with the caveat that Brazil insists on not mirroring the G-77 (the modern continuation of the Non-Aligned Group).
There is a real possibility that states with an Islamic majority and full economic dynamism (such as Malaysia and Indonesia) will join the “partnership”.
Even if a “definitive” list is drawn up, adjustments will be made to the common investment projects, as we have been highlighting in successive texts and analyses.
The “risk of the bloc becoming an anti-Western bastion” is the systematic propaganda of media conglomerates guided by the State Department.
Even so, there are traces of reasonableness in some broadcasters from the hegemonic North.
According to an analysis by the Friedrich Naumann Foundation (in theory a think tank in defense of Western liberal democracy), the proposal of sanctioned countries is to expand a financial architecture outside the dollar standard.
Let’s see: “The work now focuses mainly on creating payment and settlement systems (BRICS Pay) for the use of national currencies; To this end, a BRICS Pay Consortium has been formed to develop solutions for private/retail clients (BRICS Pay QR), corporate clients (BRICS Pay B2B) and BRICS Clear (an intergovernmental digital settlement system for cross-border securities transactions based on blockchain technology); Russia and Iran, a new member of BRICS, both subject to strict Western sanctions, have a strong interest in alternative payment and settlement systems that are not controlled by the West.
In contrast, the other BRICS members, which have active trade relations with the West, are only interested in a certain degree of de-dollarisation and the introduction of settlement in national and digital currencies to a limited extent and only to the extent that this offers protection against sanctions and secondary sanctions and can facilitate the attraction of additional investment; Therefore, due to the different starting points and interests as well as the technical challenges, a long process of coordination and implementation is to be expected here too”.
It is necessary to expand a non-dollar system in Latin America
Although far from being fully realized, the existence of common trade flows and investments outside the dollar axis is not unattainable.
Sanctioned countries such as Iran and Russia are “naturally” moving closer to Cuba, as well as Venezuela and Nicaragua.
On the other hand, Brazil and Bolivia can move forward with productive projects within the NDB model, and with stronger guarantees and securitization conditions.
Any initiative in this area strengthens the BRICS economy beyond the sale of commodities to China, and, despite all the shouting and whining from the pro-Western media in the country, the advancement of this circuit is indeed a multipolar reinforcement and diminishes the presence of imperialist hegemony in Latin American economies.
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