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Bessma Momani is professor of political science at the University of Waterloo and senior fellow at the Centre for International Governance Innovation.

BRICS, a club of emerging market economies that includes Brazil, Russia, India, China and South Africa founded in 2006, has frequently captured the imagination of those searching for an alternative to the American-dominated international financial architecture. Despite now accounting for 40 per cent of the world’s population, and by some measures over 30 per cent of the world’s GDP (having recently surpassed the G7′s share), BRICS still does not have the foundational depth to challenge the U.S.-backed liberal international order.

The Biden administration’s decoupling of trade with China, thwarting its technological giants’ rise to protect U.S. national security, and isolating Russia with punitive international sanctions for its war on Ukraine, have all given the BRICS members a renewed determination to add some heft to the annual summit, which is currently taking place in Johannesburg. Led by confident, boisterous and nationalist leaders, BRICS has a common gripe with these perceived American diktats that are reversing years of globalization efforts and economic interdependencies.

Many Global South countries are also fed up with the Americans for making them take sides in what’s clearly a brewing cold war, particularly when the West is in relative global economic decline and while both China and Russia remain key and necessary global trading partners. Reminiscent of the Non-Aligned Movement that emerged in the 1950s, Global South countries are trying to signal to the Americans and the West that they have other alliance options by showing newfound interest in joining the BRICS club. South African officials noted that 23 countries have formally applied to become BRICS members, with a similar number informally expressing interest in membership.

The addition of new members is a key item on the agenda of the BRICS summit this week. The challenge will be for current BRICS members to all agree on what criteria will be used to allow countries to join the club. Admission of new members is dependent on achieving unanimity, and India in particular remains wary of admitting countries too closely allied to its old geopolitical rival, China. Like NATO and EU expansion, consensus-based decision-making on issues of membership are often fraught with additional geopolitical considerations.

The BRICS membership application of oil-exporting heavyweights such as Saudi Arabia and Iran, and key oil exporters like Nigeria, Algeria, Venezuela and the United Arab Emirates, has attracted the attention of de-dollarization enthusiasts and those claiming that this marks the beginning of the end of American economic hegemony. Oil is the most valuable traded commodity in the world and has always been invoiced in U.S. dollars. The hope of some is that the addition of these oil exporters to BRICS would finally break the grip of the greenback and bring an end to the petrodollar.

This is nothing more than wishful thinking, however, as the dollar’s dominance in the oil trade is not determined by the preferences of oil-exporting countries but by futures markets, where oil is traded. For financial exchanges and international businesses, there is still no substantive alternative to the U.S. dollar that can provide the same level of confidence in its backing of value. The same logic applies for most countries’ central banks, which also prefer to hold dollars over other currencies in their foreign reserves.

Despite its many ups and downs in its short history, the Euro is increasingly being used in global payments, but has not overtaken the U.S. dollar. Moreover, thanks to Beijing’s own restrictions to control its value on international markets, the renminbi is not fully convertible into other currencies, posing a real deterrent for international businesses to use it in international trade. Today there is no currency that has the institutional depth to challenge the dollar in global payments and trade transactions, and the long-proposed BRICS common currency remains illusory at best.

BRICS is far from rebalancing the world order, despite rising frustration with American foreign economic policies. There have been many false starts to this hopeful counterweight to the G7, and the meeting in Johannesburg is just more of the same claims for remaking the world economic order. The global frustration with the liberal international order will be compounded if the next American elections bring further hardening of an “America First” global economic strategy. Until BRICS can build alternative financial institutions that elicit the confidence of markets, investors, and businesses alike, the liberal international order will continue to wobble along.

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