EconPol Forum 01/2024: BRICS Enlargement: What Are the Geoeconomic Implications?

In January 2024, five politically and economically heterogeneous countries ‒ Saudi Arabia, Iran, Ethiopia, Egypt, and the United Arab Emirates ‒ joined the BRICS. The BRICS+ countries now represent around 45 percent of the world’s population and around a third of global GDP. The BRICS were originally founded as an economic alternative to the Western bloc led by the USA and the EU. The idea was to offer the countries of the Global South a counterweight to Western institutions. The current change in the geopolitical and geoeconomic framework has driven the expansion of the BRICS. And it will also play an important role in shaping the international order of tomorrow.

Our authors take a critical look at some key economic and political challenges: What impact will the BRICS enlargement have on the world? What are the strategic implications for the EU and the G7? Will this change the role of multilateral institutions such as the IMF, the World Bank, and the WTO? Will this affect partnerships with the Global South?

They also highlight some new economic opportunities for the BRICS+ members, the Western world, and the Global South, as well as propose joint multilateral strategies and cooperation measures needed to seize these opportunities.

In “Economic Policy and Its Impact,” the authors examine the extent to which mentoring programs can improve the school-to-work transition of disadvantaged adolescents in Germany. “Institutions Around the World” analyzes the reasons why moving towards a strong decentralized federal state would be beneficial for the European Union. Finally, in “Big-Data-Based Economic Insights,” we offer some new empirical evidence on the effects of EU regional policy.