We have extensively covered the BRICS expansion as well as its key implications for the world economy, most notably from the viewpoint of which categories of countries would benefit the most from the enlargement of the BRICS core. One aspect, however, of this expansion that has not received sufficient attention in the discussions was the rise in the consolidated share of the expanded BRICS grouping in international organizations such as the IMF. In fact, if a higher degree of coordination were to be attained by BRICS in Bretton Woods institutions, their consolidated voting power would surpass key thresholds rendering the bloc more influential and effective on the international arena.
A look at the current distributing of voting shares in the IMF suggests that the total for the BRICS-5 core before the latest expansion amounts to 14.15%, with the respective individual shares amounting to 6.08% for China, 2.63% for India, 2.59% for Russia, 2.22% for Brazil and 0.63% for South Africa. The cumulative total for this group of countries is just short of the 15% threshold that provides the grouping with material capability to affect Fund’s decisions. This is because in IMF decision-making “an 85 percent majority is required for the most important decisions, such as admission of new members, increases in quotas, allocations of Special Drawing Rights, and amendments to the Articles of Agreement”.
With the 2023-2024 BRICS expansion the BRICS total share in the IMF increases by 3.76 percentage points to 17.91% with Saudi Arabia’s 2.01% as part of the expanded BRICS total. Even without Saudi Arabia the BRICS total increases by 1.75 percentage points on account of Egypt’s 0.43%, Iran’s 0.74%, UAE’s 0.49% and Ethiopia’s 0.09%. The total for BRICS 9 economies then increases to 15.9% – still well above the 15% threshold.
At this stage the only IMF country member that has a voting share of more than 15% is the US with its 16.5%. The next 4 largest Western economies from Europe – the United Kingdom (4.03), France (4.03%), Germany (5.31%) and Italy (3.02% – command a collective share of 16.39% – also well above the 15% threshold. Another possible configuration of alliances that comes close to the 15% threshold is the “ASEAN+” alliance that includes apart from the ASEAN members proper, economies such as Japan (6.14%), South Korea and Australia.
The progression of the revision of the country shares in the IMF has been slow at best and for the developing economies to secure a qualitatively greater role in international organizations there is a need to explore more inclusive and extensive platforms of cooperation. With respect to the IMF, there may be scope to explore the benefits of formats such as BRICS+ that are based on the aggregation of votes of the members of BRICS+ regional integration arrangements. Indeed, according to the estimates of Arapova and Lissovolik (2021) the cumulative voting share of BRICS+ economies in the IMF on the basis of a platform for regional integration arrangements rises to over 21% under the current distribution of voting shares in the Fund.
Overall, the expanded BRICS-10 may raise its collective weight in international organizations to levels that will enable the bloc to wield greater influence in the decision-making process in international economic organizations. There is an even more promising venue for BRICS in consolidating and increasing the collective weight of the Global South – this is the BRICS+ format that brings together the votes of core BRICS economies as well as their regional partners. Such a strategy may notably strengthen the capability of developing economies in advancing the reforms of international institutions such as the WTO as well as the distribution of votes on organizations such as the IMF. Creating Global South alliances in international organizations on the basis of BRICS+ rather than only BRICS core may create a wide enough platform to materially affect the pace and the direction of the reform of global economic governance.
Yaroslav Lissovolik – Founder of BRICS+ Analytics.