Argentinian president-elect Javier Milei’s team in charge of international relations is reportedly weighing up whether Argentina should proceed with joining BRICS or not. This, according to experts the team has consulted, represents “an opportunity rather than a risk” for the country.
While a final official decision has yet to be made, whichever side the coin lands on will have a significant impact on Argentina’s economic future. That the right-wing libertarian president-elect is mulling the merits of joining may be indicative of a softening of his hard-line campaign stance. That stance included a number of provocative claims in addition to the suggestion that the South American country would not be one of the new members joining the BRICS grouping of the world’s five largest emerging markets.
Having secured victory in the election, that he is apparently willing to adopt a more pragmatic change in attitude comes as no surprise. Given that Milei is no longer in the opposition, he is now tasked with the seemingly impossible mission of navigating Argentina out of unprecedented economic woes marked by a triple-digit inflation, depleted foreign reserves and a poverty rate of more than 40 percent. Against this backdrop, good relations with the major emerging markets of BRICS are just too important for Argentina. It would be akin to cutting off one’s nose to spite one’s face to distance Argentina from other emerging economy markets.
As outgoing president Alberto Fernandez said, joining BRICS would help Argentina “open up possibilities of joining new markets, of consolidating existing markets, of raising investment coming in, of creating jobs and raising imports”, all of which Argentina desperately needs.
Membership of the enlarged BRICS would definitely align the country with the economic dynamics of the BRICS member states, which combined already account for 42 percent of the world’s population and more than one-fourth of the global GDP. The new BRICS with the addition of six countries would represent 46 percent of the world population and around 37 percent of global GDP when measured at purchasing power parity.
The BRICS grouping has become an important platform for emerging markets and developing countries to strengthen solidarity and cooperation. The New Development Bank the group established in 2014, as well as the BRICS nations’ trillions of dollars in reserves, would be able to provide enough liquidity to help Argentina refinance its mounting debts.
Indeed, Argentina would have nothing to lose, but everything to gain, from its joining of BRICS. Not to do so would prove to be extremely costly for the country.
