A Shifting Global Trade Order
The BRICS+ group is increasingly asserting its economic influence on the global stage, signaling a move toward a more multipolar world. With its growing share in global GDP, merchandise trade, and financial transactions, BRICS+ is challenging the long-standing economic leadership of the G7. The expansion of BRICS+ and its efforts to create alternative financial systems—such as a new trade and reserve currency backed by gold and key commodities—suggest a potential transformation in global trade dynamics.
The Rise of BRICS+ in Global Trade
Data from the International Monetary Fund (IMF) and the World Trade Organization (WTO) highlight the steady rise of BRICS+ in global trade. Since 2000, the bloc’s share of global merchandise exports has more than doubled from 10.7% to 23.3% in 2023. In contrast, the G7’s share has declined from 45.1% to 28.9%, indicating a shift in global trade power. If the current trajectory continues, BRICS+ could surpass the G7 in global exports by 2026.
Beyond merchandise exports, BRICS+ nations are also strengthening their import networks, with China, India, Russia, Brazil, the UAE, and Saudi Arabia playing crucial roles. Their rising economic importance is not just altering trade flows but also influencing global financial systems, with an increasing focus on reducing dependence on Western-controlled platforms such as SWIFT.
India and China: Key Drivers of BRICS+ Trade Growth
Among BRICS+ members, China and India remain the dominant economic players. According to the IMF’s World Economic Outlook, China ranked as the world’s largest economy in purchasing power parity (PPP) terms in 2023, while India ranked third. By 2028, India is projected to rise to third place globally in both PPP and market exchange rate (MX) terms.
China’s contribution to BRICS+ exports surged from 36.1% in 2000 to 62.5% in 2023, while India’s share stood at 7.9%. Both nations are expected to play pivotal roles in shaping the global trade framework, with expanding influence in both exports and imports.
High-Tech Trade: The Next Frontier for BRICS+
BRICS+ countries are increasingly shifting towards high-tech exports, diversifying beyond traditional commodities. WTO data from 2022 indicates that the bloc commands a significant share in global exports of textiles (49.6%), telecommunications equipment (41.3%), clothing (36%), and electronic data processing and office equipment (35.7%). Notably, the BRICS+ share of global high-tech exports—including telecommunications equipment, integrated circuits, and electronic components—has grown from 5.0% in 2000 to 32.8% in 2022, reflecting a strong move toward technology-intensive industries.
This shift underscores BRICS+ countries’ ambitions to reduce reliance on Western technology while enhancing their role in global supply chains. With continued investment in research, infrastructure, and innovation, BRICS+ nations are set to challenge the West’s dominance in high-tech manufacturing and exports.
Financial Shifts: Currency Realignments and the Decline of the US Dollar
BRICS+ economic expansion is also affecting global currency dynamics. The Chinese Yuan has remained relatively stable with slight appreciation, whereas the Indian Rupee has experienced depreciation since 2018. These currency trends reflect broader shifts in the global financial system, with BRICS+ nations pushing for increased use of their own currencies in trade.
A significant development in this regard is the declining dominance of the US Dollar as the global reserve currency. Its share in global reserves has fallen from 71.5% in 2000 to 58.2% in 2024. BRICS+ nations are advocating for a multi-currency framework for international trade, reducing their reliance on the US Dollar and mitigating risks associated with Western financial institutions.
The Geopolitical and Economic Implications
As BRICS+ expands its economic footprint, the G7’s traditional influence over global trade and finance faces increasing challenges. The bloc’s efforts to establish alternative financial systems, foster economic cooperation, and boost technological capabilities are reshaping global economic governance.
In the near future, BRICS+ is likely to both compete and collaborate with the G7 in setting trade and financial policies. Key areas of competition include technological leadership, control over global financial transactions, and trade alliances. At the same time, cooperation in areas like climate change, infrastructure investment, and global supply chain resilience could create new opportunities for engagement between the two economic blocs.
What’s Next?
- Expansion of BRICS+: With new potential members, the bloc’s share in global trade is expected to surpass that of the G7 by 2026.
- Strengthening Financial Alternatives: Continued efforts to develop a reserve currency and alternative trade settlement platforms could accelerate the de-dollarization trend.
- Technology and Innovation Focus: Increased investment in high-tech sectors will further enhance the bloc’s competitiveness in global markets.
- Geopolitical Impact: The growing economic influence of BRICS+ will continue to challenge Western-dominated financial institutions, leading to a more multipolar global order.
As BRICS+ asserts itself as a powerful force in global trade, the international economic landscape is undergoing a fundamental transformation, setting the stage for a new era of competition and collaboration.
