BRICS agreed to take a common position in the World Trade Organization

By Paul Jouvenet, essayist and consultant in international affairs. Eurasia Business News, August 4, 2024. Article n°1130.

The BRICS ministers of economy and trade at the talks in Moscow agreed on a common position within the framework of the World Trade Organization (WTO). It is assumed that this will strengthen the requirements of countries to preserve the role of the organization and resume the work of the trade dispute settlement mechanism. The members of the association also promised to increase trade ties within supply chains and opposed restrictions on access to technologies and markets, including within the framework of climate regulation.

The BRICS countries have agreed on a common position on trade issues, including participation in the WTO, follows from the communiqué after the 14th meeting of the ministers of economy and trade of the countries of this association held on July 26 in Moscow.

Statements on supply chains, climate-related trade measures, trade facilitation in agriculture and cooperation within the WTO were approved. The Russian delegation was headed by Minister of Economy Maxim Reshetnikov – according to him, many countries in the world are now concerned about the practice of increasing trade barriers under the guise of protecting national security interests.

BRICS countries emphasize that the WTO should embody the interests of all members, particularly developing economies

The BRICS, according to the communiqué, oppose anti-competitive trade measures that impede the industrialization and economic modernization of countries, as well as “increasingly complex restrictions that are imposed on individual companies, as well as affect the export of technology, access to ports and other modes of delivery, as well as payments.”

The agreements reached in Moscow suggest that representatives of the BRICS countries will begin to coordinate positions on the topics discussed within the WTO.

This also applies to the work of the dispute settlement mechanism (the WTO appellate body does not work due to a shortage of judges – their appointment was blocked by the United States, so the decision of the appellate instance cannot be obtained from the end of 2019). It is assumed that the countries of the association will begin to hold consultations before important events within the WTO.

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As the head of the department of trade negotiations of the Ministry of Economy, Ekaterina Mayorova, explained to Kommersant, we are talking about the attempts of the countries to develop a common position, so far it is not ready on any of the issues. A common position should also be a response to the crisis within the WTO: it is becoming increasingly difficult for members of the organization to agree with each other, and coordination of positions within BRICS can strengthen the negotiating position of member countries. The main similarity of the positions lies in the interest in continuing the work of the dispute settlement mechanism and, in general, in preserving the role of the WTO.

Another document, a statement on the effective functioning of supply chains, reminds us that the BRICS countries are among the largest owners of natural resources, including critical ones.

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These resources can be used in joint supply chains and for global leadership in green energy. It should be noted that the BRICS are wary of the EU’s efforts to gain access to such resources from other countries within the framework of trade agreements. The statement also calls on the members of the association to more actively build up cooperation within trade chains and develop logistics. To do this, the countries should create “economic and legal incentives for the development of joint industrial and investment projects“, strengthen the exchange of technologies for “structural transformation and industrialization in the BRICS countries”, and increase regional connectivity through the integration of various modes of transport.

A separate point is the facilitation of access to trade finance and a “fast, cheap, transparent and inclusive cross-border payment system.” Negotiations on this track are closed, but the head of the Central Bank, Elvira Nabiullina, noted at a press conference on Friday that the process of creating such ties is not fast (in particular, it is planned to use the issue of digital assets for this, however, in both Russia and China, the use of digital currencies is still at the pilot stage).

The positions of the BRICS on climate issues are the closest. They criticize green protectionism measures and are preparing to present such a position not only within the WTO, but also at other venues. In particular, we are talking about negotiations on the circulation of plastic, which are now underway at the UN platform, Ekaterina Mayorova explained.

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On July 28 Malaysia has sent Russia an application to join BRICS. This was stated by Malaysian Prime Minister Anwar Ibrahim on the social network X. He noted that the country’s intention to join the association was the main topic of his meeting with Russian Foreign Minister Sergei Lavrov. The day before, on July 27, the head of the Russian Foreign Ministry visited Malaysia for the first time since 2015.

By 2030, the BRICS+ will together account for 40% of global GDP and about 45% of the population, with 3.5 billion people. New memberships from 1 January 2024 will help to reach these numbers.

The next BRICS summit will take place in Russia in Kazan in October 2024.

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© Copyright 2024 – Eurasia Business News. Article No. 1130.