Will Saudi Arabia Become a New Member of the BRICS?

Saudi Arabia, a longtime ally of the United States, is in talks to join the BRICS Group’s New Development Bank (NDP) as a new member, according to a source within the bank.

The move, which analysts consider as anti-U.S., would strengthen relations between the kingdom and the world’s biggest developing economies—Brazil, Russia, India, China, and South Africa—that established the bank in 2014 as an alternative to Western-led Bretton Woods institutions.

“In the Middle East, we attach great importance to the Kingdom of Saudi Arabia and are currently engaged in a qualified dialogue with them,” the source told The Financial Times.

Saudi Arabia’s interest in joining the bank comes amid a wave of diplomatic initiatives in the Middle East to bring regional powers closer to China and Russia, two rivals of the U.S. in global affairs.

In March, Saudi Arabia and Iran, which have been locked in a proxy war for years, reached a historic reconciliation mediated by Beijing.

The deal was seen as a sign of China’s growing influence in the region and a setback for the U.S., which has sought to isolate Iran over its nuclear program.

The kingdom also joined the Shanghai Cooperation Organization, a security bloc led by China and Russia, in October.

The move raised questions about the development of its strategic partnership with China, especially after it signed a $400 billion investment pact with Beijing last year.

Saudi Arabia’s shifting alliances reflect its frustration with the U.S. over its withdrawal from Afghanistan and its perceived lack of support for its war in Yemen.

The kingdom also faces pressure from the Biden administration to improve its human rights record and end its blockade of Qatar.

The US, however, remains Saudi Arabia’s largest trading partner and arms supplier. The two countries share common interests in countering Iran’s regional ambitions and ensuring stability in oil markets.

The BRICS Development Bank has not yet confirmed Saudi Arabia’s application for membership. The bank currently has 11 members, including Turkiye, Egypt, and Indonesia. It plans to expand its membership to 20 by 2022.

 

BRICS Group

Saudi Arabia and Iran are looking for membership in an influential bloc of emerging economies that rivals the Group of Seven in economic clout, according to officials familiar with the matter.

The bloc, known as BRICS, consists of Brazil, Russia, India, China, and South Africa. It has a combined gross domestic product of $51.49 trillion, based on purchasing power parity, which adjusts for differences in living costs.

That surpasses the $49.37 trillion GDP of the Group of Seven countries: Britain, the United States, Canada, France, Germany, Italy, and Japan.

Economists say that BRICS, which could expand its ranks to include Saudi Arabia, Iran, and possibly Algeria, poses a challenge to the dominance of the Group of Seven in global affairs.

The BRICS countries have set up their own development bank to finance infrastructure and sustainable development projects in the developing world.

The New Development Bank, established in 2014, has a total authorized capital of $100 billion and an initial subscribed capital of $50 billion.

It also counts other countries as members besides the BRICS nations: the United Arab Emirates, Bangladesh, Uruguay, and Egypt, which officially joined on Thursday.

Saudi Arabia’s bid to join BRICS comes amid a thaw in its relations with Iran, brokered by China less than three weeks ago. The two regional rivals have resumed diplomatic ties after years of animosity over conflicts in Yemen and Syria.

Both countries are also part of another Beijing-led initiative: the Shanghai Cooperation Organization, a political, economic, and security alliance for Central Asia that was founded in 2001.

The organization has nine members: China, Russia, India, Pakistan, Kazakhstan, and four other former Soviet republics in Central Asia. It also has several observer or dialogue partner countries, such as Iran, Egypt, and Qatar.

The Shanghai Cooperation Organization aims to secure a prominent role for its members in the future world order. Through China’s influence, it is also courting Saudi Arabia to join BRICS.

 

BRICS Plus

China is seeking to expand its influence in the emerging world by inviting more countries to join the BRICS group.

The initiative, dubbed “BRICS Plus,” comes as some members of the G7 industrialized nations try to woo India and South Africa away from the BRICS bloc, which has been vocal in its criticism of the unipolar world system.

Among the countries that China has approached are Saudi Arabia, Argentina, Egypt, and the United Arab Emirates, all of which have expressed interest in joining the BRICS.

Saudi Arabia’s desire was confirmed by South African President Cyril Ramaphosa, who returned from a state visit to the kingdom last month.

The next BRICS summit, scheduled for later this year, will discuss the 19 applications for membership, according to Russian Foreign Minister Sergey Lavrov. He said 13 of them were formal requests, and six were unofficial inquiries.

His deputy, Sergei Ryabkov, had earlier said that the issue of BRICS expansion would be “discussed” during a ministerial meeting in Cape Town.

“There are many strong candidates to join the BRICS, and Saudi Arabia is one of them,” Ryabkov said.

But joining the BRICS may not be an easy decision for Saudi Arabia, which risks straining its relations with the West, especially the United States.

The kingdom needs to weigh the pros and cons of joining, taking into account several important aspects.

Eslam Abdelhamid, a political researcher who specializes in Gulf foreign affairs, told Al-Estiklal that contrary to popular belief, the BRICS is not an economic organization, but a purely political one.

He said it was a bond of countries dissatisfied with the unipolar world order and seeking to replace it with a new one in which they would have more weight.

However, he added, this goal may not be achieved because Western countries are still the main partners of the group in the fields of economy, technology, and trade. Therefore, the economic and integration projects of the BRICS countries are still on paper only.

He also dismissed the idea of a single currency for the group, saying it would require creating a unified center for issuing common money, which would entail giving up a large part of sovereignty in the economic sphere.

This would contradict the main undeclared goal of the group, he said, and would not be able to compete with the global use of the dollar, which has reached 70% in recent years and may continue until the end of the next decade.

 

Potential Risks

The move could offer the kingdom a chance to diversify and develop its economy beyond oil and reduce its reliance on Western allies.

But joining the BRICS also comes with risks and challenges. Abdelhamid says that the most significant one is the growing geopolitical rivalry between the West and the East, led by the BRICS countries, which are carving up the global economy into competing spheres of influence.

“This could put Saudi Arabia in a difficult position, as it has long been aligned with the West politically,” Abdelhamid noted.

To avoid alienating either side, Saudi Arabia should make clear that it is not taking sides in any political dispute and that it seeks to build balanced trade partnerships with various international powers.

“The kingdom should also emphasize its commitment to international cooperation in economic matters and its reluctance to get involved in political conflicts,” he mentioned.

The urgency of this balancing act is underscored by the escalating war in Ukraine, where Russia faces off against the West and China backs Moscow.

The conflict could force countries to choose sides between the East and the West, as staying neutral may not be an option, according to Abdelhamid.