The BRICS alliance, a coalition of emerging economies originally comprising Brazil, Russia, India, China, and South Africa, continues to grow despite challenges posed by shifting geopolitical dynamics. The bloc, which recently welcomed new members including Indonesia, Egypt, Ethiopia, Iran, and the United Arab Emirates, is navigating the global stage under the scrutiny of an incoming U.S. administration led by President-elect Donald Trump. With Trump’s administration threatening a 100% tariff on BRICS nations should they attempt to dethrone the U.S. dollar, analysts are divided on whether the bloc’s trajectory poses a tangible challenge to Western economic hegemony.
China, the bloc’s leading economic force, is positioning itself to mitigate any economic repercussions stemming from potential U.S. trade measures. Analysts suggest that Beijing’s strategic interests, particularly its ambition to establish an alternative global economic order, remain the linchpin of BRICS’ resilience against external pressures. David Lubin, a senior research fellow at Chatham House, argues that China’s ability to support BRICS members aligns with its broader goal of consolidating influence among developing nations. This approach is underscored by China’s extension of zero-tariff policies for least-developed countries, including those in Africa, which came into effect in December 2024.
The bloc’s expansion and its increasing engagement with developing nations signal its intention to challenge the dominance of Western-led institutions. However, the cohesion of BRICS as an alliance remains questionable. Duncan Wrigley, chief China+ economist at Pantheon Macroeconomics, describes the group as a “talking shop” lacking a unified strategy. This perceived lack of concrete action raises doubts about its ability to dethrone the U.S. dollar as the world’s primary trade currency. The creation of a unified BRICS currency, a proposal championed by Brazil, has yet to gain traction, while efforts to promote multi-currency trade through local currencies, such as the yuan and ruble, are still in nascent stages.
The challenges of de-dollarisation have been further highlighted by the enduring global appeal of the U.S. dollar. Lubin notes that despite BRICS’ efforts, the Chinese yuan is far less usable internationally compared to the dollar, given the dominance of dollar-denominated financial markets. While Russia, under President Vladimir Putin, has strongly advocated for de-dollarisation as a countermeasure to U.S. sanctions, the feasibility of such measures remains uncertain. In recent BRICS discussions, including the 2024 Kazan summit, member nations reiterated their commitment to reducing reliance on the dollar but failed to present a cohesive or actionable framework to achieve this goal.
The potential for a trade war between the U.S. and BRICS nations adds another layer of complexity to the bloc’s expansion. Trump’s administration, with its explicit focus on BRICS as an economic and geopolitical entity, represents a departure from the relatively dismissive stance of outgoing President Joe Biden. The prospect of punitive tariffs, however, may backfire on U.S. interests, potentially driving neutral nations closer to Beijing’s orbit. This scenario, Wrigley suggests, could undermine U.S. influence and bolster China’s efforts to position itself as an alternative pillar of global economic governance.
However, there is evidence suggesting that BRICS has substantial potential to challenge U.S.-led economic systems. Proponents of the bloc highlight that its members collectively represent over 40% of the world’s population and contribute nearly a quarter of global GDP. According to a World Bank analysis, the economic output of BRICS nations is projected to outpace that of the G7 by 2030, driven by rapid industrialisation and infrastructure development in member states like India and Brazil. Additionally, BRICS’ New Development Bank (NDB), established in 2014, has provided over $30 billion in funding for infrastructure and sustainable development projects, offering a viable alternative to Western-dominated institutions like the International Monetary Fund (IMF).
Supporters also argue that BRICS’ multi-currency trade initiatives are already yielding results. For instance, trade between Russia and China is increasingly conducted in yuan and rubles, bypassing the dollar. According to a report by the Global Times, the volume of yuan-settled trade transactions between these two nations doubled in 2024 alone. This demonstrates that member nations are capable of reducing reliance on the dollar through incremental, bilateral arrangements, even if a unified BRICS currency remains elusive.
Moreover, the bloc’s inclusivity and appeal to developing countries underscore its broader significance. With more than 30 nations expressing interest in joining BRICS, the alliance is expanding its reach beyond traditional economic and political boundaries. Nations in Africa, the Middle East, and Southeast Asia see membership as an opportunity to balance Western influence and access alternative funding and trade mechanisms. The admittance of Indonesia, one of Southeast Asia’s largest economies, highlights BRICS’ ability to attract key regional players, further enhancing its global influence.
Nonetheless, internal dynamics within BRICS present significant obstacles to its cohesiveness. While Beijing wields considerable influence within the bloc, member nations remain cautious about potential trade imbalances and China’s dominance. Mihaela Papas, director of research at the MIT Center for International Studies, emphasises that this internal caution is likely to limit China’s ability to unilaterally shape the bloc’s trajectory. Furthermore, many BRICS members maintain strong trade relations with the U.S., recognising its importance as a critical economic partner. Gustavo Medeiros, head of research at Ashmore Group, observes that these ties reduce the likelihood of a united BRICS front in the event of a trade war.
The Kazan summit, which marked the bloc’s 16th annual meeting, offered little in terms of substantive policy shifts. While the expansion of BRICS membership underscores its growing appeal, the lack of concrete allied strategies diminishes its potential as a credible counterweight to Western-led institutions. Cecilia Malmström, senior fellow at the Peterson Institute for International Economics, notes that the summit resulted in “nothing really concrete,” reinforcing the perception of BRICS as a loosely organised coalition.
Ultimately, the BRICS bloc faces a complex and multifaceted challenge in its quest to reshape the global economic order. While its growing membership and engagement with developing nations signal a shift in global power dynamics, the absence of a cohesive strategy and enduring reliance on the U.S. dollar remain significant barriers. As Trump’s administration prepares to take office, the interplay between U.S. policies and BRICS’ aspirations will likely shape the geopolitical landscape in the years to come.
