Renewing Russia and the World

19 june 2015

BRICS Membership Poses an Intellectual Challenge to Russia

Mikhail Korostikov is a political scientist, a participant in the G20 Youth Summit in 2014.

Resume: BRICS offers Russia a chance to steer clear of the whirlpool of economic and political problems with self-respect intact and international weight increased thanks to the solution of global challenges. BRICS’ field of activity is enormous.

The association of Russia, Brazil, India, China, and South Africa (BRICS) has completed the full cycle of presidencies, and this year it is Russia’s turn to host the summit. Why do we need this organization? Have we got from it what we wanted? In Russia, analysts are largely unanimous on the tasks faced by the five-member alliance. Executive Director of Russia’s National Committee for BRICS Studies Georgy Toloraya, in his article “Why Does Russia Need BRICS?,” indicated that the first objective of the association was to reform international financial institutions; the second one, to create mechanisms for maintaining security; and the third one, to facilitate inter-civilizational interaction.

For Russia, BRICS now serves as the key support amid the sharply deteriorated relations with the West. This point is specially emphasized by other prominent pro-BRICS politicians, such as State Duma Deputy Vyacheslav Nikonov and Foreign Ministry Coordinator for BRICS and G20 Vadim Lukov.

However, BRICS has not yet come up with an official coordinated vision of the future. This five-nation club expresses concern over various problems, discusses certain practical aspects of cooperation and holds private talks behind closed doors. Is it a proper format of relations for the five countries aspiring to leadership on their respective continents? Are they fully using the potential of the organization, and has BRICS lived up to its expectations? Many believe that it has not. BRICS should foremost get busy with the political aspect of its interaction, designing a program to build a fairer world system less prone to conflicts.

In this case Russia would have an excellent opportunity to bolster its international prestige and solve domestic self-identity problems. The resentment at a lack of respect and isolationist calls for substitution of imports, some “special way” for Russia, the mantra of “spiritual bonds” and “the Russian world” conceal the fear to admit the obvious fact that the country needs a radical ideological overhaul, as it is unable to produce any attractive models based on previous experience. The European countries, the primary source providing means of modernization to Russia during its entire history, have stopped cooperation and introduced sanctions.

Even Kazakhstan and Belarus, Russia’s closest partners at the Collective Security Treaty Organization (CSTO) and the Eurasian Economic Union, occasionally stage demarches, trying to exploit Moscow’s contradictions with the European Union and China and frequently using anti-Russian rhetoric in their domestic politics. Lastly, the irrevocable loss of Ukraine in 2014 as a friendly state dealt the most powerful blow to Russia’s prestige, causing a radical change in its foreign and home policies. Regrettably, this didn’t help things take a turn for the better: it is no longer about Russia’s development or economic growth, but about its stabilization and economic survival.

BRICS offers a chance to steer clear of the whirlpool of economic and political problems with self-respect intact and international weight increased thanks to the solution of global challenges. BRICS’ field of activity is enormous. In fact, the five states were brought together by a negative agenda rather than a positive one: they are facing the threats which can only be overcome through cooperation, such as the obsolete world governance system, the global financial and economic system that no longer meets the demands of individual states, structural problems of global economic development, environmental degradation, and the media space favoring a group of Western nations.

These issues will top the 21st century agenda, and a state or a group of states suggesting an optimal solution can by right expect the support of most of the countries. A future international system must be highly inclusive, meeting the needs of the new majority of active players in global politics. In designing the system, it is necessary to avoid confrontation with the United States and the European Union, offering them a worthy niche as befits their potential without providing any extraordinary advantages which they enjoy today. Let us elaborate on why the above aspects of the modern world order need reform.

Global governance

The present-day world governance system emerged after World War II and has long ceased to meet modern realities. As the UN was established, its priority was to prevent a conflict between the key players in international relations. In 1945, the population of the UN Security Council member-states (including their dependent territories) made up approximately 66 percent of the planet’s population. The aggregate Gross Domestic Product of these states and territories reached 59 percent of the world GDP. They were the World War II winners and later became the sole possessors of nuclear weapons.

In 2014, the aggregate GDP of the UN Security Council members made up 44 percent of the world GDP, while the share in the world’s population dropped to 26 percent. As of now, India, Pakistan, Israel, and North Korea have nuclear weapons, too, while some 20 countries are on the threshold of going nuclear, that is, they can develop nukes within three to six months from the time of making such a decision. This is not to say that these countries should be included in the world governing bodies, it rather implies that this technology is not too difficult to emulate, and possessing it is a sovereign choice of a state, which however does not grant it membership in an elite club.

Humanity has two ways out of this situation. The first is to start another world war to determine the relative weight of each center of power. The other way is to try to reform the UN with due account for the new global landscape. This objective should become a priority for the BRICS countries in the coming decade. The credibility of this unique international institution whose array of functions has no alternative is compromised by its non-representation in the UN Security Council. The associated risks of ushering BRICS into the UN Security Council are understandable: the top UN body should be compact enough to remain effective, yet it should also reflect the existing global landscape. The permanent UN Security Council member-states, which include two BRICS countries, are not keen to share power. The BRICS nations need a group consensus on these issues in order to become an agent and advocate of changes beyond the association.

As one of the measures, Russia could offer a mechanism of joint open discussion of certain UN issues on the BRICS platform regardless of which country holds the rotating UN Security Council presidency. If some UN decision is crucial for India, Brazil or South Africa and does not impact Russian and Chinese national interests, why can’t Russia or China use their vetoing rights or active support for the cause of their BRICS colleagues? The BRICS countries are unanimous on a majority of issues, so the promotion of the principle of joint discussion of international development issues would help Russia gain political weight without restructuring the UN Security Council. In this case the United States, Britain, and France would officially bear responsibility for keeping the obsolete configuration of the UN Security Council.

The global financial and economic system is the key topic for discussions at BRICS summits and in the cooperative format of the five-member group also on the G20 platform. In 2001, a commission led by Allan Meltzer thoroughly analysed the operation of Bretton Woods institutions, and a detailed report was later presented to the U.S. Congress, explaining the reasons behind the IMF’s ineffectiveness during the Latin American debt crisis of the 1980s, the Asian financial crisis of 1997, and Russia’s default in 1998.

The Commission’s report indicated that the leading industrialized countries used the IMF for their own purposes, while the degree and forms of the IMF’s control over the debtor countries’ economies undermined their democratic development. The IMF and the World Bank would often act as agents of the United States’ and Western Europe’s interests, specifically in vote-buying votes at the UN Security Council and the UN General Assembly (a study by Ilyana Kuziemko and Eric Werker), and would allow the developed countries to “encourage” or “punish” the developing ones by changing the number of loan terms.

The failure of the U.S. Congress to support the IMF reform, approved by other G20 members, shows how far Washington can go to agree to change the existing landscape. The WTO has been unable to make headway at the Doha negotiations since 2001, as the parties cannot agree on subsidies for agricultural products. Finally, top rating agencies in early 2015 lowered Russia’s rating below investment grade, despite its stable macro-economic situation and considerable gold and foreign exchange reserves.

Appeals to conscience and demands for fairer distribution of governing roles at these institutions are likely to avail nothing. The developed countries will always regard the loss of jobs and markets and contracting economies as a more serious threat than the accusations of double standards or injustice. The situation is actually ridiculous: non-Western states are trying to secure larger representation at the institutions meant to structure the world according to Western patterns. BRICS’ objective would be the establishment of parallel bodies reflecting the interests of the member-states’ long-term development.

 The signing of the agreements on the BRICS Bank and currency swaps in 2014 were the right moves in this direction, as were the tentative plans to set up a BRICS rating agency announced in early 2015. It is very important, however, to make sure that these initiatives do not turn into a cargo cult imitating the existing institutions with the sole purpose of expressing one’s disagreement with the West. BRICS really needs a new Development Bank and a Forex Fund to address the challenges that did not exist during the establishment of the Bretton Woods system. Launching a sweeping program of infrastructural, “green” and high-tech investments (especially in Global South countries) is a prerequisite for expanding the markets and securing a peaceful and balanced development of the planet.

The Asian Infrastructure Investment Bank (AIIB) can serve as a good example of a new type of institutions. Created by China in 2014, it already has the support of a majority of Asian and large European states, despite the hidden resistance on the part of the United States. After some deliberation, Russia decided to join, although it had rejected the decision a year earlier. Its doubts can be understood: the AIIB is a purely Chinese project (as is the Silk Road Economic Belt), in which Russia can only play second or even third fiddle. In the long run, the Kremlin seemed to reconcile itself to the fact that China, having the world’s largest economy (or the second largest, according to different estimates) will naturally lead the new financial institutions.

 Instead, Russia can and should aspire to the role of BRICS’ political center, but this requires that it adopt a more global course, stop leaning on the local values which only find understanding inside the country, and show its readiness to work towards the common good. The domestic public discussion should become less conflicting and more oriented towards the search for cooperation opportunities with all the participants in global processes, especially with the BRICS states.

Structural economic problems

The structural problems of global economic development in general and the BRICS countries’ in particular are another unifying factor that requires our time and efforts towards studying and changing it. The countries have absolutely different economies, but their common feature is that the BRICS “economic growth formulae” are socially and environmentally unstable even in the medium term. In effect, all the five economic models are arranged around intensive exploitation of their primary advantage and unspoken public consensus that one can sacrifice certain things such as ecology, social justice, and political freedoms for the sake of quick profits.

Natural resources in Brazil, Russia, and South Africa, as well as the labor force of India and China made it possible for them to retrace, in 20 to 40 years, the path along which the Western countries walked for two or three centuries. But the old capitalist states forming the core of the world system had BRICS and other developing states bear their social, environmental and other costs in the 1970s through the 2000s. Can the new centers of power do the same? Obviously they cannot, because they have nowhere to divert their costs; apparently, the continental Southeast Asia will become the last region industrialized in this manner.

Paraphrasing Leo Tolstoy, the economic model of each BRICS state is unstable in its own way. The 2012 BRICS Report indicated that Brazil’s key problem was a weak financial sector and a lack of competitive goods; Russia suffered from a slow reform of raw material monopolies and a poor investment climate; India was plagued by the failure to meet basic social needs of the population and undeveloped infrastructure; China, by inequality and insufficient domestic consumption; and South Africa had a high unemployment rate with large groups of population excluded from the modernization process. Meanwhile, regardless of the kind of problems facing individual BRICS countries, the outcome for all of them is basically the same – growing inequality and environmental degradation.

According to the CIA World Factbook, the Gini index, which measures the degree of inequality in the distribution of family income in a country, reaches 36.8 percent in India and 63.1 percent in South Africa, making the latter the planet’s second unequal society. Despite the unprecedented development rates in the past two decades and the sacrifices laid on the altar of welfare, the BRICS countries, in particular India and China, can hardly attain the consumption standards characteristic of the developed nations simply because they do not have enough resources.

At present, conflicts within each BRICS country are contained by the consensus on creating a common economic “pie” with the public understanding that it pays more to create a surplus product than re-distribute it. The slowdown of development rates, which has been happening in Brazil and Russia for some time and is beginning in India and China, will inevitably shift the public demand from building capital to its redistribution, because the level of individual consumption comparable with the West’s will not have been attained by the moment of economic slowdown.

BRICS should focus on intellectual search for a new economic model hedging from conflicts and ensuring an even and less extensive economic growth. To this end, they have to launch close cooperation at the existing BRICS Think Tank Council and expand research ties between other research institutions. The work at this task could breathe new life into the Russian humanitarian school which was one of the most influential in the world in the 20th century. This will require Russia to abandon the prevailing course towards conservatism and autarchy as it can hardly find supporters in the countries where a majority of the population under 40 years of age increasingly associate the past with backwardness, dictatorship and colonialism.

Environmental degradation and lost ground in media space

The environmental degradation of the BRICS countries is aptly described in various studies. The four original BRICS members continue to top the list of the six countries in terms of the volume of methane and carbon dioxide emissions. According to some estimates, environmental problems already cost China up to 15 percent of its GDP and cause significant damage to other BRICS members because of ongoing massive extraction of natural resources in Russia, Brazil, and South Africa and their exponential consumption in China and India. Being aware of the importance of the problem and related risks, Chatham House described it in detail in a report released in December 2012 and suggested the establishment of the so-called Resource 30 (R30) dialogue format that would bring together 30 principal suppliers and consumers of resources to jointly resolve the emerging challenges.

The idea is worth consideration, and BRICS could begin to discuss it. The five BRICS states put together account for more than 40 percent of the world’s population and accommodate areas that sustained the worst ecological damage, such as Lake Karachai and the towns of Norilsk and Dzerzhinsk in Russia, the river Yamuna and the town of Vapi in India, Tianjin and Linfen in China, Rondonia in Brazil, and Witbank in South Africa. Aside from concerted efforts within the climate change conference and interaction in the BASIC format, BRICS should ponder the funding of the reclamation projects in environmentally-abused areas through the BRICS Development Bank.

A lack of such initiatives at the national level is explained by the fear to lose competitiveness due to increasing production costs and the fact that these costs had long been regarded as acceptable in the period of modernization. At present, the problem is getting more attention, especially in China which adopted a new environmental protection law on April 24, 2014, which, as a Chinese minister put it, effectively “declared a war on pollution.” In a broad sense, the BRICS countries are facing a new task, namely the establishment of large branches of the economy engaged in recycling, land reclamation, and water and air purification. Undoubtedly, the solution of this problem without negative impact on economic growth will find the support of other developing countries.

The garble in the media space is explained by the fact that the information sources of developed countries dominate in the world in general and BRICS countries in particular, and a significant portion of the information is delivered to BRICS residents through West-controlled channels. Consequently, the information they receive is insufficient and often biased. ВВС and CNN only broadcast the material they regard as interesting to the Western viewer in accordance with his established stereotypes. It is not so much the distortion of information which is the problem as its insufficiency.

The BRICS countries are largely to blame for this situation. For example, RT, Russia’s leading multilingual television channel, broadcasts in English, Spanish, and Arabic, whereas RTVi, an international Russian-language privately owned television network, only broadcasts in Russian. The Russia Beyond The Headlines (RBTH) Internet project is faring better, with the available versions in all BRICS languages. Regrettably, television remains more popular than the Internet in all the BRICS countries, according to a TNS Global study, watched by 66 percent of Chinese viewers, 73 percent of Russians, 78 percent of Indians, 82 percent of Brazilians, and 85 percent of South Africans. This means that information via the Internet is not available to the bulk of the BRICS population. Similarly, India, Brazil, and South Africa have no channels to broadcast in BRICS languages. China’s CCTV broadcasting network has Russian and English channels and is planning to launch broadcasting in Portuguese. However, due to the worldwide popularity of the English language, the globalized BRICS population inevitably turns to sources in English.

The number of students in the BRICS countries learning each other’s languages is incomparably smaller compared with that of the students of English. Strong inter-civilizational ties in the 21st centuries are forged not by top-level meetings, but millions of contacts between business people, scientists, students, and tourists. So far, representatives of all BRICS countries have preferred to study in the EU, Japan, and the United States, contribute scientific articles to local journals and invest in foreign countries. The West’s domination shows not so much as overpowering military and economic might as the intellectual hegemony it has become, as Antonio Gramsci put it.

As one of the measures to step up humanitarian cooperation, BRICS came up with the initiative to create a university to facilitate student exchange in master degree programs. However, the university alone is clearly unable to make a breakthrough in this sphere of cooperation. BRICS colleges need to sharply increase the quotas for foreigners from member-states, arrange large cultural events related to BRICS, boost the publication of BRICS literature in their territories, and provide theme programs on the key television channels. South Africa has set a good example with its decision to issue 10-year visas to BRICS company executives. Meanwhile, it is crucial to understand that for Russia, which aspires to be a world leader in the future, BRICS is a deliberate and long-term choice, not a bargaining chip in the period of worsening relations with the West.

Of course, BRICS is facing more than these five designated problems. It can launch extensive cooperation in maintaining security, combating poverty, space exploration and many other areas, but the five designated fields should become the basis for all others. The BRICS states have similar positions on these issues, which makes it easier for them to reach a consensus and advocate changes in the international arena. It is the boldness in fulfilling these tasks that can consolidate the international public opinion around BRICS. Russia should take up the helmsman’s role leading the ship of the five states into the future, making BRICS and the relationship with its members the focus of its foreign policy agenda.

The overbearing emphasis on Ukrainian-Russian relations in the past year involving permanent stand-off with Washington and Brussels is not what Russia deserves in the era of fundamental shifts in world politics and economics. The intellectual construction of a new world can have a beneficial impact on the home policy: it will at last have a new format of evolution without endless attempts to secure recognition from Western states. This course does not imply the rejection of Western values or the European civilization: it will enable the country to become a self-sufficient and influential state which undoubtedly will be able to claim a worthier place, including a seat at the European table. Alexander Gorchakov’s phrase “Russia is concentrating” should get a follow-up: Russia is focusing on BRICS in order to come back renewed.

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