As the heads of state of the most populous nations meet in Fortaleza, they should reflect on the name of the city where they have gathered.
In Portuguese, Fortaleza means fortress. And that’s how the markets look to each of the member countries of BRICS. While the BRICS have been meeting as a formal group for a while now, there isn’t much for the members to crow about. The member countries have been talking to each other rather than with each other.
Unlike trade blocs that are built on regional proximity, BRICS are spread across four continents. What they have in common is a young population, rising growth rates and aspirational market.
Traditionally trade and investment have been focused around the developed countries. The emerging markets are still too dependent on western markets and have not adequately explored peer countries. While in recent years, countries like China and India have moved to African markets, there aren’t enough trade and investment links between emerging markets.
As the leaders meet in Fortaleza, they should avoid quibbling over the headquarters of the BRICS Bank. This is not a matter for muscle flexing. The bank can be headquartered anywhere as long as it has equal representation by all member countries. It should avoid becoming institutions like World Bank and International Monetary Fund that are seen as fiefdoms of the US and EU respectively.
For BRICS it is important to offer greater market access to each other. This is partly about reduced tariffs and other barriers. The last few years have seen a general decline in trade and non-trade barriers but the BRICS need to thrash out specific points of conflict.
Most importantly, the logistic and travel connections between the countries must be greatly enhanced. Unless people can travel freely and easily across these five countries, improved trade and investment linkages can’t be expected.
All of them are well connected with Europe and the US thanks for historic relations. But now the focus must be on improving connections within.
That would be the best way to break down the walls around the countries and create a larger, more accessible fortress called BRICS.