BRICS currently accounts for 45 percent of the world’s population and 35 percent of the world’s economy in terms of purchasing power.
The BRICS group recently held its first summit since the group’s expansion, in Kazan, Russia, the rotating chair country.
Through the group, China and Russia are seeking to establish an alternative international payment platform that is not subject to Western sanctions—a tactic that experts say is unlikely to work.
BRICS was established by Russia, China, India, and Brazil, expanded to include South Africa, and then further expanded with the membership of Egypt, Ethiopia, Iran, and the United Arab Emirates. Saudi Arabia has been invited to join the group but has not formally become a member.
Russia has been using China’s Cross-border Interbank Payment System (CIPS)—a Chinese Yuan RMB-based cross-border payment system—for limited international trade since it was banned from the U.S. dollar-based Society for Worldwide Interbank Financial Telecommunications (SWIFT) platform following Russia’s invasion of Ukraine in 2022.
Wang Guo-chen, an assistant researcher at the Chung-Hua Institution for Economic Research in Taiwan, said the chances are slim that China and Russia can truly change the international financial system.
According to statistics from the People’s Bank of China, in 2023, CIPS processed an average of 30,000 transactions per day, involving 482.6 billion yuan (about $67.8 billion).
Wang said that the U.S. dollar-based SWIFT, which handles 42 million transactions per day that are worth $5 trillion, has the advantage over CIPS by a large margin.
“If a country can’t join SWIFT, it means it’s kicked out of the global financial exchange. So, it’s basically impossible for Beijing to change the global financial system,” Wang told The Epoch Times.
Taiwanese macroeconomist Henry Wu told The Epoch Times that the economies of the core three countries in BRICS—China, Russia, and Iran—will continue to be compressed.
“Because the global political situation is the confrontation between the United States and China … the basic strategy of the United States is to cut off the Chinese Communist Party’s … financial support and gradually eliminate its economic momentum,” he said. “In this way, the [Chinese Communist Party (CCP)] will eventually be unable to sustain itself because of internal economic problems and regime crisis, let alone aiding other regimes.”
By Alex Wu
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