By Yaroslav Lissovolik

The events of the past several years have amply demonstrated that in the midst of the unprecedented pressure experienced by BRICS the most important priorities for the bloc on the economic front and on the international stage more broadly are to forge ahead with trade liberalization, trade policy coordination as well as joint plurilateral formats of cooperation. The latter is particularly crucial in order for the BRICS not to be isolated and subjected to escalating pressure on a one-on-one/bilateral basis. We have accordingly argued in favor of plurilateral formats within BRICS+ such as the BRICS Troika as well as a multiplicity of other formations that may be advanced within the extended platforms of the Global South. In what follows we explore the sequence of building alliances across the developing world that allow for creating mega-regional formations with significant weight to attract more trade flows and attenuate the pressure that BRICS economies increasingly face individually in the global arena.

There may be several levels of building plurilateral economic frameworks across the Global South. The most important is regional integration that has gained momentum across the developing world. At this stage, all of the BRICS-5 economies have assembled their regional integration arrangements, all of which featured in the BRICS+ outreach activities during the BRICS+ summits of the past decade. In particular, for Brazil the key regional integration bloc is Mercosur, for Russia it is the Eurasian Economic Union, for South Africa it is the South African Customs Union, for China it is the ASEAN-China FTA and for India it is BIMSTEC. The resulting grouping of integration blocs was termed in 2018 as the BEAMS formation that represented a platform for trade liberalization and connectivity among the BRICS core members and their regional partners.

The next level of regional cooperation among the developing economies is the pan-continental integration across the three main regions of the Global South – Latin America, Africa and Asia. In the case of Latin America this cooperation may be advanced by organizations such as CELAC, with the pan-continental platform effectively bringing together such regional projects as Mercosur, the Pacific Alliance, the Central American Integration System (SICA) and the CARICOM. In Asia, the main pan-continental foundation may be served by the Shanghai Cooperation Organization in the form of SCO+ that brings together such regional blocs from Eurasia as SCO, ASEAN, GCC and the Eurasian Economic Union (SAGEs formation). In Africa, the pan-continental bloc is the African Continental Free Trade Area (AfCFTA) led by the African Union. A mega-regional that would bring together the three pan-continental mega-projects of the developing world across Africa, Latin America and Eurasia has been termed as the Trilateral Inter-continental Alliance (TRIA).

The third level of regional integration brings together significant parts of the global economy that may comprise some of the advanced economies – such is the Regional Comprehensive Economic Partnership (RCEP) led by China and ASEAN, with the participation of advanced economies from the Pacific. Another possible formation that we have proposed in our recent articles is a community of the Southern Hemisphere with ecological alliances and trade liberalization forged across the region’s main integration groups such as Mercosur, ASEAN, PACER+, SACU/SADC (abbreviation – MAPS).

It is important to realize that the “integration of integrations” path of bringing together these regional and mega-regional projects opens up crucial development pathways that would not be nearly as accessible to bilateral alliances between individual national economies. This mega-regional mode of economic cooperation boosts multilateralism (even if not at the level of the entire global economy) via strong multiplier and complementarity effects that are only yet to be explored and assessed. Several regional pairs across the Global South may exhibit sizeable complementarities, in particular:

- ASEAN and the Eurasian Economic Union (EAEU): cooperation between one of the most land-locked alliances in the world (4 out of 5 economies landlocked in the EAEU) and one of the most important blocs for maritime integration and international economic cooperation (only 1 land-locked economy in ASEAN). For the EAEU the region of ASEAN may be a crucial logistical outlet into global markets, while for ASEAN it is about gaining access to the Central Asia region with mounting growth rates as well as expanding market, openness and demographics. At this stage ASEAN and Central Asia are among the global leaders in terms of growth rates – ASEAN via trade and Central Asia via increasing connectivity.

- Mercosur – AfCFTA: a full-fledged economic cooperation across these two blocs opens up the region of the South Atlantic as an extended region of economic cooperation (extended oceanic economic space) between Latin America and Africa as well as for the Global South and the Southern Hemisphere. It is only through building the Africa-Latin America mega-regional that such an expansion in economic cooperation/multiplier effect becomes possible through the uniformity of trade rules, customs procedures and expanding port facilities.

- ASEAN – AfCFTA: this would be an alliance between one of the main growth engines of the world economy (ASEAN) and a region with the greatest growth potential (AfCFTA). Greater trade liberalization in ASEAN vis-à-vis Africa would provide a major growth driver for Africa through exports – something that is increasingly in the works in recent periods as Vietnam, ASEAN’s fastest growing economy, is working with South Africa on launching an FTA with the South African Customs Union (SACU).

In the end, the single most important potential driver of higher economic growth in the global economy today is neither AI, nor even the elusive breakthroughs in sustainable energy transition per se. In our view, it is the consolidation and closer economic integration of the Global South – not only among its largest economies such as China, India, Brazil, South Africa or Indonesia, but also their respective regional integration blocs. The diversity, multiplicity and complementarity across the regional blocs of the Global South is enormous and could only be dreamed of by the Global North – exploring the entire possibility set of all regional and mega-regional alliances across the developing world could significantly broaden the growth possibilities not only for the emerging markets, but also for the global economy. Indeed, the reason why BRICS+ became such an appealing platform for developing economies is that it opens up these critical possibilities for boosting economic growth, for consolidating resources, coordinating economic policies and thus for raising the weight of these nations on the international stage. A pragmatic strategy for building plurilateral accords and mega-regional alliances within the framework of BRICS+ would serve to open new gateways for the developing world to finally approach the heights of its true economic potential.

Yaroslav Lissovolik is a Founder of BRICS+ Analytics.