Reshaping Global Governance: BRICS and the Rise of the Global South

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Western Dominance in Global Governance

When the modern international system was established after World War II, it was primarily shaped by the United States and its Western European allies. One of the key pillars of this post-war order was the Bretton Woods regime, initiated in July 1944 in New Hampshire, United States. The conference, led by British economist John Maynard Keynes and American Treasury official Harry Dexter White, resulted in the creation of two major global financial institutions: the International Monetary Fund (IMF) and the World Bank. The primary goal of the Bretton Woods system was to stabilize the post-war global economy by establishing a fixed exchange rate system based on the US dollar and to facilitate reconstruction and development. However, the governance structure of these institutions was based on financial contributions, effectively ensuring that developed countries retained dominant voting power.

In practice, developing countries, particularly those in Asia, Africa, and Latin America, were positioned more as recipients than as shapers of global policy. Although formal colonialism began to recede in the mid-twentieth century, the global political and economic structure that emerged maintained unequal hierarchies. This structural imbalance gave rise to calls for a reorientation of global governance. The wave of decolonization in the 1950s and 1960s further strengthened solidarity among formerly colonized nations. This shared awareness was reflected in multilateral initiatives such as the 1955 Asian-African Conference in Bandung, Indonesia, attended by 29 countries from the two continents. The conference not only voiced anti-colonial sentiments but also underscored the importance of South-South cooperation as an alternative to major power dominance.

This solidarity later evolved into the formation of the Non-Aligned Movement (NAM) in 1961, which sought to distance its members from the Cold War polarization between the Western and Eastern blocs. In this context, the term Global South began to be used to describe developing countries facing similar challenges in development and international relations. While no single individual is credited with coining the term, it gained traction in academic and development discourse during the 1970s as a way to distinguish the geopolitical and economic positions of these countries from those in the Global North.

Jim O'Neill’s Report and the Formation of BRICS

Initially, BRICS was an economic concept introduced by Jim O’Neill, an economist at Goldman Sachs, in a 2001 report. He highlighted Brazil, Russia, India, and China as emerging economies with significant growth potential that could shape future global economic dynamics. Although the concept began as a financial projection, these four countries initiated informal diplomatic engagement in 2006, leading to the first official summit in 2009 in Yekaterinburg, Russia. In 2010, South Africa joined the group, turning BRIC into BRICS.

Over time, BRICS evolved from a discussion forum into a more structured platform for economic and political cooperation. The establishment of the New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA) marked concrete steps to provide alternatives to the traditional Western-dominated financial institutions. In recent years, BRICS has also opened up to expansion. At the 2023 BRICS Summit in Johannesburg, six new countries were invited to join: Saudi Arabia, the United Arab Emirates, Iran, Egypt, Ethiopia, and Argentina. Indonesia has also been mentioned as a potential candidate for future expansion, due to its strategic location in Southeast Asia and its growing role in the Global South’s economy.

One of the main arguments supporting BRICS’s relevance in global affairs is its growing economic contribution. According to the International Monetary Fund, in 2023 the BRICS countries collectively accounted for approximately 32 to 35 percent of global GDP based on purchasing power parity (PPP), while the G7 accounted for around 29 to 30 percent. This shift signals a broader realignment of economic power from the Global North to emerging economies. Moreover, BRICS represents about 45 percent of the world’s population and maintains an average annual growth rate of 4 to 5 percent—significantly higher than the G7’s 1.7 to 2 percent. In the long term, this trend puts increasing pressure on the current global economic structure, which has long been dominated by developed nations.

The growing relevance of BRICS is also evident in its trade relations. Intra-BRICS trade increased by 56 percent between 2017 and 2022, reaching over USD 422 billion by 2022. More broadly, South-South trade has surged to approximately USD 5.3 trillion, accounting for more than 21 percent of global trade. BRICS’s contribution to global trade stands at roughly 24 percent. However, intra-BRICS trade still represents only about 12 percent of their total trade potential, indicating that while BRICS has become an important economic actor, there is considerable room to deepen internal economic integration and enhance cooperation among its members.

Opportunities for the Global South

The New Development Bank stands as one of BRICS’s most tangible responses to the development needs of the Global South. Established to finance infrastructure and sustainable development projects, the bank was designed to be more flexible than traditional international financial institutions. NDB funding has been directed toward various initiatives, including in non-BRICS countries. For instance, in 2020 the NDB provided a USD 1 billion loan to South Africa to support its COVID-19 emergency response. In India, the NDB has financed metro rail projects in Mumbai and Pune aimed at reducing congestion and carbon emissions. In Bangladesh, although it is not a BRICS member, the NDB supported a renewable energy project as part of its broader Global South outreach. These cases illustrate the bank’s growing role in alternative development financing, even though its scale is still smaller than that of the World Bank.

Meanwhile, the CRA functions as a currency reserve mechanism that BRICS countries can use in times of liquidity pressure or balance-of-payments crises. Although it does not yet match the scale or influence of the IMF, its existence reflects BRICS’s efforts to build its own financial safety nets. The development of cross-border payment systems has also become a focal point. As geopolitical tensions and economic sanctions rise, some BRICS members have promoted the use of local currencies and domestic payment systems. Although the financial infrastructure is not yet fully integrated, this shift signals a move toward diversification and the gradual reduction of reliance on the US dollar.

Challenges Ahead

One of BRICS’s core challenges lies in the imbalance of power among its members. China’s GDP far exceeds that of the other member states, and its global diplomatic and financial influence continues to grow. This asymmetry raises concerns that BRICS could turn into a platform that primarily advances Beijing’s foreign policy interests, rather than remaining a balanced multipolar coalition. Furthermore, the complex relationship between India and China adds political strain to intra-group cooperation. Border disputes and strategic rivalry have limited collaboration on several key issues. Differences in their approach toward the West are also evident. India remains relatively open to cooperation with the United States and its allies, while Russia and China often adopt more confrontational stances.

Institutionally, BRICS still lacks a permanent secretariat or legally binding mechanisms, making it heavily dependent on the political will of its leaders, which can shift with domestic changes. In functional terms, the institutions established by BRICS have yet to match the scale and global reach of entities like the IMF or World Bank. However, the BRICS model emphasizes voluntary and equal partnership, in contrast to the more top-down and conditional approaches often associated with Western institutions. In several instances, BRICS’s non-intrusive approach has proven attractive to countries seeking to avoid political strings or economic conditionalities. Although its overall influence remains limited, this alternative model signals a potential path for reform and serves as a reminder for older institutions to reflect on their legitimacy and inclusiveness.

Toward a More Equitable Global Order

BRICS has emerged as part of a broader global dynamic in which developing countries are seeking to redress longstanding imbalances in global governance. With its growing collective economic power and the gradual development of alternative institutions, the bloc holds the potential to amplify the voice of the Global South. Yet, to become a truly influential actor, BRICS must navigate internal divisions, strengthen its institutional capacity, and remain committed to inclusive cooperation. Ultimately, the success of BRICS will not be measured by rhetoric or expansion alone, but by its concrete impact in shaping a more equitable and representative global system.