BRICS Expands: Which New Countries Joined? (And Who Wants To)

BRICS Expands: Which New Countries Have Joined The Group?

BRICS Expands: Which New Countries Joined? (And Who Wants To)

February 18, 2024 873 view(s)

January was an important month for the BRICS+ alliance and the world, due to who officially joined the alliance and who did not. Some were expected to join and reported to have joined but have not. Of the six nations expected to join, only Egypt, Ethiopia, Iran, and the United Arab Emirates have done so. This is still a significant development, as they are the first new nations welcomed to join since the BRICS alliance was formed. It is also significant who did NOT join (Argentina and Saudi Arabia), as many other nations waiting in the wings have expressed an interest in following Saudi Arabia’s lead. 

 

As we will see today, regardless of the ultimate actions taken by Argentina and Saudi Arabia, gold is gaining ascension as a premier world trading and reserve asset. It behooves us as Americans to pay attention and gather some gold while we are gathering dollars.

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Nations That Joined

With the addition of Egypt, Ethiopia, Iran, and the UAE, the BRICS+ alliance share of the world economy is now greater than that of the G-7 alliance of nations. As a review, the G-7 is comprised of Germany, France, Canada, Japan, Italy, the United Kingdom, and the United States. Twenty-two years ago, the BRICS portion of the world economy was less than half of the G-7. Now, it exceeds the G-7. This has happened over time and is not due solely to the addition of four new nations to the BRICS+ alliance. Population centers, industrial bases, and wealth creation in developing economies are more responsible for this shift, which is expected to continue.

 

 

When you think of Ethiopia, perhaps poverty and starving children holding out a bowl to receive some porridge come to mind. However, Ethiopia has found oil and has begun the process of exploration and extraction.  Hundreds of billions of barrels of oil are believed to be connected to oil shale fields found in Ethiopia. This find has the potential to propel Ethiopia into an economic leadership role throughout Africa and the world. American oil companies and investors were already present, helping develop these fields prior to their official admittance as a BRICS+-aligned nation. 

Much is at stake here as we move forward, in a country previously not thought of as an economic powerhouse.

 

 

Egypt, while officially part of Northern Africa, has long been an important partner of the United States and has often helped stabilize events in the Middle East. Egypt has purchased/received American-made military equipment throughout the years. It remains to be seen what the new BRICS+ membership will mean for Egypt’s relationship with the United States, and for the stability of the region in the years ahead.

 

Iran is an oil-rich nation that has had a love-hate relationship with the United States in years past. A previous ruler (Shah of Iran) was seen as friendly to the West, causing Iran to have a good relationship with the West from the mid-1950s until being deposed by the Iranian Revolution in 1979. Then what was known as the Iran Hostage Crisis occurred, whereby revolutionaries took American hostages, and a year-long standoff ensued. More recently, Iran has been involved in supporting terror groups such as Hamas and Hezbollah and attacking American military ships and bases scattered throughout the Middle East.

BRICS Has New Members Join - Looking to Dethrone the DollarBRICS Has New Members Join - Looking to Dethrone the Dollar

Iran is a powerful nation with nuclear ambitions that has been under economic sanctions by the United States continuously since 1987. As a sanctioned nation (like Russia), they were a natural fit for BRICS+ membership. Even before officially joining BRICS+, Iran had already been an important partner for Russia and China.

 

The UAE is an oil and gas-rich country with significant reserves, in which less than 12% of the residents originate from the region. The other 88% of the population are expatriates from other nations who moved to the UAE for employment serving the citizenry. The UAE has been an important economic partner with the United States in the past and has helped bring economic stability to the region. It has been a wealthy and relatively peaceful region of the Middle East. It will be interesting to see what the new BRICS+ membership will mean for their relationship with the West moving forward.

 

What is significant about Saudi Arabia not joining is that Saudi Arabia is in the midst of the four nations that did join (see map above). This is a key region of the world currently experiencing shipping difficulties due to missile attacks from militia groups sponsored by Iran. Saudi Arabia has been the lynchpin of the petrodollar world reserve currency system enjoyed by the United States since being created around 1974. While the petrodollar world has already been hindered and impacted by non-dollar oil trading happening between BRICS+ nations, Saudi Arabia joining BRICS+ could signal the official end of the petrodollar system. You can imagine the intense tug-of-war going on between the United States, Saudi Arabia, and their neighbors that have already joined BRICS+.

 

Saudi Leadership Role

What is also significant is that 34 additional nations expressed an interest in joining the BRICS+ alliance when/if Saudi Arabia joins. Contrary to reports that say Saudi Arabia has officially joined BRICS+, they have not. 

What happens to the 34 nations taking cues from Saudi Arabia remains to be seen, but what is certain is that gold is becoming a more important asset globally, and the dollar is becoming less important. One hundred fifty-nine nations have signed up to use the new BRICS+ version of SWIFT (Western money transfer system), with 20 nations deciding to ditch the use of the dollar as they transition. While the dollar is not going away anytime soon, the world that requires or accepts the dollar as payment is getting smaller. That is why it is becoming increasingly important for the average American to own some gold.

 

Gold acts as a hedge against the loss of purchasing power of the dollar. The dollar has lost purchasing power through the years, even though it was the World Reserve Currency. Think about how much purchasing power it can lose when it loses world reserve currency status. Owning tangible assets such as precious metals can help preserve your wealth and purchasing power as the world continues the inevitable march away from dollars and towards gold.