Today's Edition
DINA MAHMOUD (LONDON)
Following the dedicated application of the “Fifty Principles”, the foundation for the organisation of the UAE’s institutions next fifty years, the state’s official accession to the BRICS group, comprising some of the world’s most promising economies, marked a significant development.
This event, aligning with the new year’s onset, mirrors the ambitions outlined in the second of the “Fifty Principles”, focusing on building a leading global economy and fostering a superior economic environment worldwide.
The UAE’s integration into BRICS, a bloc representing 42% of the global population and contributing 25% to 29% of the world’s GDP, while accounting for over 16% of global trade volume, underscores the UAE’s strategic diplomacy.
This move, ratified at the recent BRICS summit in Johannesburg, reflects the UAE’s success in cultivating robust partnerships worldwide, enhancing its economic and commercial stature as a pivotal global connector.
Long-term Partnership
The UAE’s BRICS membership crowns its long-standing relationship with the bloc, showcasing its commitment to developmental alliances with economically experienced nations.
An early contributor to the BRICS New Development Bank launched in the middle of the past decade with a capital of $100 billion, the UAE has actively engaged in sustainable development and infrastructure projects within and outside the BRICS nations. The bank aims to mobilise resources for infrastructure projects and sustainable development in developing and emerging countries, including those within the group itself.
Recently, the UAE participated in the mid-2023 “Friends of BRICS” forum in Cape Town, highlighting its active role within the group. The country’s diverse investments in BRICS nations span various sectors, including infrastructure, food security, clean energy, and transportation, further solidifying its economic ties.
Additionally, a comprehensive economic partnership agreement with India, a key BRICS member, was signed in February 2022, strengthening the UAE’s economic cooperation with the bloc. Before joining BRICS, the UAE was described as a “long-term partner” of the promising bloc, which has become one of the largest economic groupings globally, surpassing the G7 both in terms of the size of its economies and population, with a population of 3.2 billion compared to G7’s 800 million.
The idea of establishing BRICS began in 2006 and has been strengthened in recent years with the inauguration of a business council and a credit rating agency dedicated to managing investments, as well as an emergency reserve fund.
BRICS’ expanding influence, now capturing 32% of the global economy, has attracted over 20 countries seeking membership, recognising its significant economic and territorial reach, covering almost 40% of the Earth’s land.
Analysts agree that the UAE’s inclusion in BRICS promises substantial benefits, enhancing its role as a knowledge-based economy and attracting more foreign direct investment, particularly from major economies like China and India. This move enhances the UAE’s competitiveness in the Middle East, ranking twelfth internationally.
BRICS’ diverse sectors offer a rich source of foreign direct investment, fostering job creation and mutual trade. The bloc’s possession of key resources like oil and rare metals further enriches the UAE’s economic options. Joining BRICS not only strengthens the UAE’s economy but also opens new global market opportunities, reinforcing its status as a leading investment destination in the Arab world.
The UAE’s BRICS membership amplifies its role as a regional and global economic force, enhancing cooperation opportunities and contributing to its non-oil trade growth. The integration into BRICS underscores the UAE’s strategic vision, emphasising partnerships as a means to address global challenges and fostering harmonious international relations.
The extensive benefits of the UAE joining BRICS are mirrored in the warm reception from member countries, affirming the UAE’s stature as a prominent economic force regionally and globally. This recognition bolsters the UAE’s initiatives to augment its economic prowess and sustainability via significant international partnerships, nurturing long-term economic growth and fostering equitable global relations.
In June, Russian Foreign Minister Sergey Lavrov highlighted that the UAE’s and other Arab nations’ inclusion in this economic coalition enhances and fortifies BRICS, contributing to a more balanced global economy.
It is widely agreed that the UAE, with its substantial Gulf market and varied international investments, will bring exceptional value to the group, boosting its capacity to fulfil objectives, fortify its global influence, and extend its reach, aligning with the current global political and economic landscape.
The UAE’s entry into BRICS enhances the group’s appeal, particularly in financial aspects, offering other members access to the UAE’s varied economic resources, innovative development strategies, significant reserve funds, and its pivotal role in global trade.
New Era
Observers note that the expansion of BRICS membership heralds a new era, enabling more developmental initiatives among member countries, facilitating market access for their companies, and augmenting the alliance’s security measures against potential threats.
Given that the founding five BRICS nations account for nearly 43% of global oil production, the inclusion of the UAE and Saudi Arabia in particular, bolsters BRICS’ role as a significant entity in the international energy sector. Additionally, this expansion will diversify the group’s cash reserves, reinforce national currencies, augment gold reserves by 13%, and increase the population base by over 15.5%.
The advantages of the UAE joining BRICS transcend economic aspects. This move amplifies the group’s proficiency in scientific research, technology, and innovation, leveraging the UAE’s established scientific and technological foundation, particularly in sectors like space, artificial intelligence, and information technology.
Financially, the BRICS economies will gain an infusion of approximately $3.24 trillion, courtesy of the vast resources from the new member nations, thereby enhancing the bloc’s capacity to match other global alliances and bolstering strategic, economic, and logistical opportunities for its members.
These shared benefits highlight the UAE’s forward-thinking approach, underscoring that collaborations are essential to surmount the collective challenges facing humanity, such as climate change, and food and energy security. This cooperation promotes shared interests among nations worldwide, fostering synergies between regional and international blocs, and steering clear of competition and conflict.
