The Brics+ group, which includes countries like India and China, is rapidly increasing its share of global merchandise exports and imports, with projections suggesting it could surpass the G7 group by 2026, according to EY India’s latest edition of EY Economy Watch. The Brics+ group’s share in global merchandise exports has risen from 10.7% in 2000 to 23.3% in 2023, marking an increase of 12.6 percentage points. Conversely, the G7’s share has decreased by 16.2 percentage points, from 45.1% to 28.9% over the same period. The share of the rest of the world has remained relatively stable, increasing only slightly from 44.2% to 47.9%.
A similar trend is observed in merchandise imports. The Brics+ group’s share has grown from 7.2% in 2000 to 18.9% in 2023, while the G7’s share has fallen from 49.8% to 33.7%. Once again, the rest of the world’s share has not changed significantly, rising from 43.0% to 47.4%. The report indicates that the importance of the Brics+ group is increasing both in terms of economic size and global trade share. As these countries enhance their coordination efforts, they may reduce the dominance of the US dollar in global trade and foreign exchange reserves and lessen reliance on the SWIFT platform.
D K Srivastava, Chief Policy Advisor at EY India, noted, “Given the current trends and the potential for new members to join the Brics+ group, it is likely that their share of global merchandise exports could overtake that of the G7 by 2026.” As the significance of the Brics+ group continues to rise in relation to global population, GDP, and trade, the G7’s lead in managing global economic affairs may be challenged. Central to this shift are India and China, which ranked third and first, respectively, in purchasing power parity (PPP) in 2023, with both projected to maintain these positions by 2030.
China’s contribution to Brics+ exports has increased significantly, from 36.1% in 2000 to 62.5% in 2023, while India’s contribution rose to 7.9%. Furthermore, the analysis highlights the growing importance of high-tech exports from Brics+ nations, whose share of global high-tech exports surged from 5.0% in 2000 to 32.8% in 2022. In terms of currency, the Brics+ nations are gaining influence. The report mentions that the Yuan has remained stable, while the Indian Rupee has faced depreciation since 2018. Additionally, the share of the US dollar as a global reserve currency has declined from 71.5% in 2000 to 58.2% in 2024, indicating a potential shift toward a multipolar currency system.
As geopolitical dynamics evolve, the coordinated policies among Brics+ members may challenge the established dominance of the G7 and the US dollar, paving the way for a new multipolar global economic landscape. The Brics+ group is working to establish a platform for international trade and investment transactions, which could offer a low-cost alternative to the existing SWIFT system. They are also exploring the development of a trade and reserve currency backed by gold and other select commodities.
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