BRICS Kazan Summit: How Much Consensus and Progress?

Hello friends, today is October 23rd, and the most important event in the past two days should be the BRICS Summit held in Kazan, Russia. This is the first summit held by the expanded BRICS, which has attracted global attention, and of course, there are also voices of skepticism.

Let's talk about this summit today, starting with its shortcomings and regrets, and then discussing its benefits and vision.

A small regret of the summit is the global boycott and sanctions against Russia, which is an important source of pessimism. In fact, according to the original order, this summit should have been held in Brazil, but Brazil had to host the G20 and then passed it to Russia. This little episode is something everyone should be aware of.

Let's imagine, if it were held in Brazil in the normal order, it should be more grand than it is now. The Crown Prince of Saudi Arabia would probably come in person, and even if Brazilian President Lula said he was injured, it would not affect his attendance. The number of partner countries and organizations invited would also be more, which is all foreseeable.

So even if there are unsatisfactory aspects of this summit, it is due to the awkward location of the event, and many countries have their own considerations, which are all understandable, and there is no problem with the summit itself.

The summit has revealed a lot of news in advance, most of which come from Russian sources. Among them, the much-anticipated topic is the BRICS countries' discussion on a payment system that is independent of the Western monetary system. There has been no significant response from official Chinese channels on this. This contrast is very interesting and highlights the differences in internal demands among BRICS countries.

For Russia, it urgently needs a payment system independent of the Western system. If the BRICS establish their own payment system, then for Russia, it can be self-sufficient within the BRICS. Basically, everything it wants to buy can be bought, and everything it wants to sell can be sold. So Russia's voice on this is the loudest and most active.

For India, it is reluctant. India also wants this system, and India also hopes to break free from the shackles of the US dollar. However, it is worried that the BRICS payment system will be dominated by the renminbi in the future. India opposes anything that is beneficial to China. It would rather everyone suffers than have you be stronger than it. This is India's consistent nature, which is normal and not strange.

For example, Indian Foreign Minister Subrahmanyam Jaishankar clearly stated in a speech at a US think tank that although some BRICS countries are promoting de-dollarization, India is not interested. India has never actively opposed the US dollar and will not seek to change the dominant position of the US dollar.For China, it certainly wants to, but since Russia is already leading the charge, there is no need for us to rush to the forefront either. China needs it, but not urgently; we can wait, even a decade or eight years would be fine. This is where China's advantage lies; China is not in a hurry.

Why isn't it in a hurry? Because in China's current foreign trade focus, the ranking of BRICS countries is at the back. First is ASEAN, second is the EU, and third is the United States. Even if a BRICS payment system is established, for at least a decade or eight years, the majority will not be used, so China is definitely not in a hurry.

Currently, there is no choice. If there is a payment system in the works that includes ASEAN plus China, which one do you think China would prioritize? The BRICS payment system would definitely be pushed back.

Brazil is also in favor of a BRICS payment system. Last April, when Lula visited China, he spoke at the New Development Bank of the BRICS organization in Shanghai, saying: "Every night, I ask myself, why must these countries use the US dollar as a settlement method, why can't they use their own national currency as an international settlement currency? Who decides this? Why not the renminbi? Why not the Brazilian real?"

It sounds very appealing, doesn't it? But don't forget, Lula also said he enjoys watching Chinese football!

Lula is a national leader and a master of his craft; he says what you want to hear, but in reality, he is not in a hurry either. During Lula's term, dealing with China, whether or not this system exists makes little difference, and there is no pressing need for Brazil to rely on Russia and India. Reality dictates that Brazil can also wait and see, otherwise, how could Lula have been injured and absent?

South Africa is just tagging along; it has always been part of the Western system, so it doesn't really matter whether it has it or not. The other BRICS countries have just joined, are smaller in size, and have limited say, so they are not analyzed for now.

Therefore, for the hotly debated internal BRICS payment system, everyone should have a reasonable expectation. The current situation is just as described, with the founding four BRICS countries plus South Africa, these five countries indeed have different demands and senses of urgency. The possibility of reaching a consensus at a single BRICS summit is not very high.

Being able to propose a structural idea at this summit is already a significant step. Then, after a year of mutual consultation and compromise, if a timetable can be officially announced at next year's BRICS summit, that would be very optimistic.

Last year, when the BRICS expanded, the BBC did a report asking, "Is China trying to create its own G7?" Although this report still reflects the mindset of Western powers, it can also provide some useful insights from the opposite perspective.The G7, also known as the Group of Seven, is a collective of Western nations. The BRICS countries will not become an organization like that. Firstly, the G7 is primarily a group that defends its own interests. It never considers the global economic development and would rather harm the development of other countries in the world for its own benefit. This is contrary to China's philosophy.

Secondly, the G7 countries share similar ideologies, economic models, and levels of development, something that the BRICS cannot match, nor is it likely to be a goal they pursue.

Therefore, the BRICS nations are inevitably going to take a completely new path in the future. Currently, the direction of this path is being fiercely debated, and this debate is evident on the surface.

Firstly, there are well-known differences in the demands between China and India, which we will not delve into.

Then, even between China and Russia, while their demands may seem similar on the surface, there are fundamental differences in their nature.

Russia places great importance on this Kazan summit and is actively promoting the expansion of the BRICS group. Russia's aim is to enlarge the scale of the BRICS to counter its current situation of isolation.

As for what to do after the expansion, Russia itself is unsure. How will it utilize this group after the expansion, and what kind of future does it envision for the BRICS? Does Russia have any unique ideas to contribute? No!

Apart from proposing a new currency and international financial settlement mechanism, there is no visionary planning. Moreover, this proposal was made by Russia based on its own urgent needs. Escaping isolation is its only driving force at the moment, and as for the future, it will take it one step at a time.

Therefore, Russia has invited 38 countries this time, inviting all that could be invited, which is commendable in terms of enthusiasm.

For China, it naturally welcomes Russia's proactive attitude, but what to do after the expansion of the BRICS organization? China has a clear idea in mind and has inadvertently revealed it.Of course, this is also a form of overt strategy. It cannot be hidden and will gradually reveal itself. Those who are attentive will understand it on their own, ponder it slowly, and have enough time to decide whether to stand on China's side.

Let's look at the official reports from China, and you will easily see such expressions: "BRICS cooperation"—the earnest expectation of the Global South! We must pay attention to the term "Global South," which is a Chinese expression and also the significant role that China hopes the BRICS will play in the future.

The Global South refers to the developing countries around the world. China hopes that the BRICS will first become a haven or sanctuary for the underdeveloped countries globally.

In recent years, with the United States raising interest rates, the global economy has essentially struggled. Sri Lanka collapsed, and Egypt also experienced a collapse. However, during this cycle of U.S. interest rate hikes, some countries have indeed survived the crisis, with significant support coming from China's currency swaps. This was a beneficial attempt and achieved good results. Such effects will continue to evolve within the BRICS in the future.

The future BRICS are very likely to be built in the direction of a haven first, and then other visions will naturally be realized more smoothly.

In the coming years, the world's structure will not be calm, and global risks will not disappear. If the BRICS mechanism can provide a role for everyone to huddle together to cope with risks, it can greatly resolve the problem of inconsistent interests after expansion.

The current BRICS system has different ideologies among its member countries, different levels of development, and different geopolitical environments. If you want to balance the interests of all parties on this basis, it is too difficult, almost impossible.

Since we cannot balance the interests, then I will focus on avoiding risks. I can make sure you don't die when you should, so what more do you want? Let's think about whether this is the truth. Avoiding risks is the greatest role the BRICS mechanism can play in the future, and it is also the easiest to achieve.

This does not mean that development is not important, but avoiding risks is easier to achieve, and the effects are also better.

In terms of avoiding risks, China has too much experience and has proven its capabilities in the practice of global interest rate hikes in recent years.Most importantly: This is a grand strategy path that uniquely belongs to China, a path that other BRICS countries cannot follow. All positive efforts made by these other BRICS countries will ultimately serve to benefit China.

There's no way around it; strength is the key determinant of everything. Among the current BRICS nations, excluding China, the combined economic strength of the other nine countries is less than half of China's, the gap is too significant. Therefore, they can only play a supporting role to China, which is naturally positioned to take on the leading role and, consequently, to reap the greatest benefits.

For instance, in this instance, although Russia's demands are aimed at liberating itself from isolation, its efforts to actively expand the influence of BRICS ultimately serve to secure more cooperation partners for China. Naturally, China is pleased to see this happen, and we need not say more; active cooperation is all that is required.

It is obvious that BRICS countries cannot unite, but it serves as a framework, and the treatment you receive whether you join or not will definitely be different.

Chinese official media characterizes BRICS in this way: The BRICS cooperation mechanism is an important platform for South-South cooperation. Within this cooperation, you can avoid risks and benefit.

So the question arises, who benefits? The answer is clear: Most of the benefits are for China. Do you expect to benefit from Russia and India? Everyone's hearts are as clear as a mirror.

Let BRICS expand, let its influence grow. At present, China does not need to take the lead. Russia has demands, and China will cooperate with it, including India, which also has demands, and China will cooperate with it as long as it does not have a negative impact.

When the circle of BRICS countries has developed deep interest bindings with China, the common interests of BRICS countries will override the petty thoughts of individual countries. At that time, it will be the time for BRICS countries to set the rules.

However, it is far from that time now. The demands of the five new countries are still in the process of being polished, and more countries want to join. It is a chaotic time now.

Despite the chaos, we must not let it blind our eyes. We need to see the various forces in the vortex, where do they want to go? Who is the temporary undercurrent, and who is the long-term mainstream?At the same time, don't be pessimistic, this process won't take too long, it could be as short as three to five years, or as long as about ten years, anything longer than that would be unbearable for us.