PREVIEW
The President hopes to cultivate collaboration and unity at this week’s summit in order to defy western isolation and challenge the dominance of the dollar
Integration on financial services, along with a common rescue fund and a grain exchange platform are top of Russia’s wish list at this week’s BRICS (Brazil, Russia, India, China, South Africa) summit hosted by President Vladimir Putin in Moscow.
Most of these items have an obvious and immediate benefit for Russia which has seen its access to finance and international markets crippled by the sanctions imposed on it by western powers because of its invasion of Ukraine in February 2022.
In particular, a contingent reserve facility designed to support member countries in economic difficulties is an obvious alternative to the International Monetary Fund and World Bank. A proposal for a BRICS reinsurance agency is a transparent bid to skirt the block on access to western insurance services under the sanctions.
The proposal for a cross-border payments system for BRICS members is an attempt to counter United States’s influence via the dollar.
However, the grain and commodity exchange platform and idea to cooperate on credit ratings could also appeal to South Africa, as well as Egypt and Ethiopia, both of whom have been invited to join the BRICS club (AC Vol 64 No 18, Beijing asserts global south leadership role).
Access to grain and food security across much of Africa has been hit by Russian embargoes on Ukrainian grain. Many African states believe that the ‘big three’ western credit rating agencies – Moody’s, Standard & Poor’s, and Fitch – do not treat them fairly, sentiment which has led the African Union to set up its own ratings agency by the end of the year (Dispatches 23/7/24,Ratings plan gets serious).
The Moscow summit could also be an opportunity for Putin to improve Russia’s broader offer to African states.
Earlier this month, Russia’s diplomatic service revealed that it was preparing agreements to expand its visa-free access to several more African countries, though without naming them.
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