The expansion of BRICS membership in the past several years took many observers by surprise in terms of its speed and scale, with the widening of the ranks in memberships and partnerships proceeding along several tracks (core expansion and the partnership belt) and leading to a near quadrupling of the number of emerging market economies in the BRICS+ circle
The expansion of BRICS membership in the past several years took many observers by surprise in terms of its speed and scale, with the widening of the ranks in memberships and partnerships proceeding along several tracks (core expansion and the partnership belt) and leading to a near quadrupling of the number of emerging market economies in the BRICS+ circle. In recent periods, however, the rhetoric from BRICS has become somewhat more reserved with respect to the prospects for further enlargement as the bloc focusses on integrating new members and elaborating further the modalities of the partnership circle. At the same time, there are dozens of emerging market economies that have expressed an interest in becoming members of the BRICS bloc – what should be the approach from the BRICS+ platform to this demand for membership? One of the possible approaches may be the delineation of BRICS conditionality principles that would explicitly formulate the criteria for accession into the BRICS+ circle, while also incentivizing emerging market economies early on to align their policy frameworks and approaches to those developed by the BRICS core.
Within the framework of the global Bretton Woods institutions there are two types of conditionalities that are employed vis-à-vis members. The first used by the IMF (Fund conditionality or ex-ante conditionality) relates to the conditions that an economy has to meet ex-ante in order to receive a loan/tranche from the Fund. The second (referred to as ex-post conditionality (used in some of the World Bank programs)) relates to conditions that have to be satisfied by the recipient of the loans that are delivered up-front, with the subsequent monitoring of the implementation of the agreed upon conditions. In the case of regional integration blocs such as the EU there is extensive experience in employing conditionality for potential members with respect to the adoption of EU policy frameworks before the accession to the regional bloc.
With more than 30 emerging economies lining up to join BRICS in an effort to become part of the core or the partnership belt the formulation of accession criteria/conditions could serve several goals. Firstly, it would allow BRICS to attenuate the growing pressures for further expansion by setting specific criteria that would need to be monitored before the eventual decision on membership is taken. Secondly, it would enable the bloc to align the policy frameworks and the incentives of candidate economies with those of the BRICS core at an early stage, preparing the ground for greater policy cohesion ex-ante and ex-post/after the emerging economies join the grouping. This case for BRICS conditionality becomes increasingly important in view of the rise in the number of members and the near-term constraints in further expansion of the core.
Given the pressing need for BRICS to prioritize the bloc’s economic agenda, it may be expedient to focus on the alignment and greater coordination of the policies and approaches of BRICS+ and candidate economies in the international economic institutions or forums such as the G20, the IMF, World Bank and the WTO. In each case when there is a motion/initiative coming from BRICS in these organizations, there could be regular ex-post assessments of these initiatives, including with respect to the scale of participation and alignment by BRICS core members, BRICS partners and the economies that have declared their willingness to join the bloc.
Another theme in the BRICS conditionality discussion should be the macroeconomic conditions similar to the convergence criteria across some of the leading regional blocs that ensure a minimum level of economic stability. This may be increasingly critical further down the road when the BRICS devise mechanisms directed at supporting the macroeconomic stability of their members via mechanisms such as a revamped BRICS CRA or other types of supporting measures that may involve regional financing arrangements (RFAs) as well as bilateral support measures. Some of the BRICS conditionality in the macroeconomic sphere could be adapted from the already existing frameworks and modalities created by the regional financing arrangements in which BRICS economies (core or partners) are members.
Overall, a lack of a clear and explicit conditionality framework within BRICS may be a factor that increasingly limits the bloc’s ability to achieve cohesion and progress on critical development issues. While the experience of Western-led regional blocs and multilateral institutions is replete with conditionality mechanisms (EU, World Bank, IMF), the framework of BRICS conditionality should not directly or fully imitate such approaches, but needs to focus on the critical areas, most notably the coordination of BRICS cooperation in international economic institutions. This may be the first step in devising BRICS conditionality that may be later developed with respect to BRICS CRA, NDB operations and other mechanisms. In the end, the BRICS conditionality framework will need to combine such qualities as connectivity with other such mechanisms in other platforms and organizations (cross-conditionality being one of the factors to consider), de-politicization (political neutrality) and greater weight accorded to the social, sustainability and human capital dimensions in economic development.
Yaroslav Lissovolik is Founder of BRICS+ Analytics.
