BRICS is an acronym for five important countries which have been gaining in economic power in recent years: Brazil, Russia, India, China and South Africa. Of these, China has by far the largest economy and the fastest rate of economic growth.
However, all of these countries are somewhat outside the main centers of world political power. Russia and China were once socialist countries; Russia had a long economic and Cold War struggle with the U.S. and its allies (with hard feelings and distrust still remaining); and Brazil, India and South Africa have all had a long history of imperialist domination and exploitation. So there is history of these countries clinging together to some degree in challenging the U.S.-led imperialist system from within. “BRICS” has become not only a convenient way of referring to some nations which are, as a collective whole at least, rising in economic power, it has also been moving in the direction of becoming a more formal conference or even a tentative international association of these 5 countries, in the midst of certain contrary pressures and internal strains among its members.
As mentioned earlier, the World Bank and the International Monetary Fund, which were set up at the close of World War II by the U.S. and its allies, gave the U.S. a grossly disproportionate share of the voting rights and control of these institutions. This has not set well with the BRICS grouping, nor with many other nations. China, with its amazing economic growth, has been asked to contribute more and more to the IMF and WB, and while its voting share has been just slightly increased it is still far below what it should be now based on the size of its economy.
In fact, as of June 2013 China has just 3.81% of the voting shares in the IMF as compared with 16.75% for the U.S. An agreement was reached in 2010 that China’s share could be raised to 6.068% provided that the IMF rules regarding such changes are followed. That means that 85% of the voting shares have to agree to the change. This in turn means that the U.S. can by itself veto any such changes, and so far it has refused to vote for the expansion of China’s voting power! Needless to say this has greatly annoyed China, which has already won the support of over 78% of the voting shares. And even if China’s vote was raised to 6%, it would still be less than half of the size it should be (in relation to the U.S.).
This sort of arrogance on the part of the U.S., and its refusal to loosen its rigid and undemocratic control of the IMF, World Bank and other international institutions, has made China (and a number of other countries, including the other BRICS countries) think that maybe some new international economic and political institutions need to be constructed as alternatives to the ones so tightly controlled by the U.S. and its closest imperialist allies.
One current idea along these lines is the plan for the BRICS countries to set up an international development bank as an alternative to the World Bank (and to some degree an alternative to the IMF as well).
The idea for such a BRICS Development Bank was actually first raised some years ago. But on March 27, 2013, the leaders of the BRICS countries held a summit meeting in Durban, South Africa, and formally agreed to establish it. In providing for the funding of infrastructure projects around the world it will be competing with the World Bank. But it will also create a “contingent reserve arrangement” worth $100 billion to help member countries counteract future financial shocks. This is the sort of thing that the IMF does. The plan is not for these BRICS countries to withdraw from the IMF and WB at this time, but just to start building an alternative to them.
However, it is not yet clear how successful this particular plan to set up a new BRICS Development Bank is going to be. It must be recalled that the setting up of the World Bank and IMF themselves could not have happened when it did if the very disastrous World War II had not just taken place, and if there had not been the Great Depression of the 1930s which many people (erroneously) expected might resume after the War if drastic measures were not taken to ward it off. Indeed, the World Bank was initially developed to formally institutionalize in permanent form the Marshall Plan, and its extension as a global credit plan. It is not at all clear that a similar sense of desperation among the “outs” within the current world imperialist system exists yet to get them to overcome their own contentions, hatreds and jealousies and set up effective alternative institutions to the World Bank and IMF.
One of the problems is that China wants to dominate the new BRICS bank in much the same way that the U.S. dominates the IMF and World Bank. (It is in the deepest nature of any capitalist-imperialist power to do this if it is able to.) China figures that since it has by far the biggest and fastest growing economy among the BRICS alliance, and since it will likely have to provide the largest contribution in capital to fund the bank, that it should basically be in charge of it. But the other BRICS countries are reluctant to set up a new institution in which their voice is scarcely listened to, just as is the case with the current world institutions. One observer put it this way:
“Ironically it may be the cleavages within the BRICS grouping that more accurately hint at the future of the global order: tensions between China and Brazil on trade, India on security, and Russia on status highlight the difficulty Beijing will have in staking its claim to global leadership.”
Still, the primary fault line that seems to be developing within the world imperialist system is between the U.S. and its close allies (on the one hand), and China, Russia, the other BRICS countries, and still other primarily less economically developed countries angry at the U.S. and its allies (on the other hand). Remember once again that we are talking at the present time about developing economic blocs and contention, not about war blocs and alliances.
While there have been trade disputes between Brazil and China, for example, at the same meeting in which the BRICS bank was chartered those two countries signed an agreement “to do billions of dollars of trade in their local currencies, as the BRICS nations work to lessen their dependence on the US dollar and euro.” That attempt by BRICS and other countries to move away from the dollar and euro is also an important early indication that a new imperialist bloc might be gradually forming.
The competition and hostility between India and China, however, may be much more serious than the differences between Brazil and China or Russia and China, and might lead India to break with the nascent BRICS alliance sometime in the future.
Probably the best way to view the situation at the present time is that this BRICS Development Bank plan is a major symptom of growing unrest and discord within the world imperialist system and a serious sign of the internal strains within that system that might eventually lead to its splitting up into separate and competing blocs. For now, the BRICS bank is sort of a tentative early step in that direction.
There are clearly echoes of one of the mythologized versions of the old Bandung idea here, of the “Third World” uniting against the imperialist “Center”. But the central flaw of that version of the Bandung idea is even more evident here: If the countries uniting are themselves imperialist, sub-imperialist, or hoping to become such, the result can at most be a competing capitalist-imperialist bloc, and not a truly anti-imperialist alliance devoted to promoting genuine national liberation struggles.
It is not inconceivable that the BRICS bank, or some successor to it, might eventually prove to be an important and powerful alternative to the World Bank and the IMF. If the funding and support for those existing institutions fails in a major way, because of the growing seriousness of the world overproduction crisis and the increasingly dire financial crises associated with it (and the consequent inability of the U.S., Europe and Japan to adequately fund them), then an alternative BRICS bank funded primarily by a still rising China might play a very important role in splitting the world imperialist system into two competing blocs.
From a pole or trend within the current world imperialist system it is possible that an eventual alternative, largely independent imperialist system might once again arise. But if this happens it will probably only happen over a prolonged period of deepening economic crisis in which the U.S. in particular suffers some very major financial damage (such as the real collapse of the dollar). There are many possible scenarios here, and it is difficult to be absolutely certain about how all this will play out.
In any case, if this or other plans by China and its BRICS partners start to prove successful, they will undoubtedly start to attract the participation and support of other countries, including perhaps other fairly important economies such as Indonesia, Thailand and Mexico. Countries such as Argentina and Turkey, which have newly developing economic difficulties, may also be looking for new economic partners. Capitalists in countries like South Korea have already started thinking that it is likely that their economic future may be more closely tied to China than to the U.S. There is therefore the potential for the BRICS economic bloc, or something similar to it, to expand considerably.
The same processes which appear to be leading to a new opposition bloc (like BRICS) within the world imperialist system are at the same time leading to weaknesses and growing disgruntlement and developing cracks between the U.S. and its closest allies.
One recent report on Germany’s foreign policy commented that “the new signals from Germany’s elite amount to a big change. They are based on the perception that America cannot or will not be around, as it once was, to solve Europe’s problems in the future. Since revelations of American spying on Germans began last summer—the latest discovery is that America tapped not only Mrs Merkel’s phone but also Mr Schröder’s since 2002—trust in the former protector has been damaged… More generally, the debate reflects a new self-confidence in Germany.” Part of this new self confidence is the idea that the German army will need to be more active abroad in the future.
As we’ve mentioned there are jealousies and disagreements within the emerging opposition bloc (such as between China and Russia), but at the same time there are also growing disagreements and contentions within the remaining U.S.-led bloc as well! Contradictions exist everywhere. But the key to a political analysis of any situation is to discover and focus on the most important (primary) contradiction first of all.
 It might have been somewhat surprising for those who believe the Cold War between the Soviet Union and its bloc (on the one hand) and the U.S. led bloc (on the other) is long over, and can never resume, to read in a recent editorial in the British ruling class magazine, the Economist, that “America’s security umbrella allows European countries to feel safe from, for instance, the possibility of future Russian aggression while spending little on defence.” [July 6, 2013, p. 12.]
 For information on the status of the effort to reform the voting shares of the IMF see “Acceptances of the Proposed Amendment of the Articles of Agreement on Reform of the Executive Board and Consents to 2010 Quota Increase” at: http://www.imf.org/external/np/sec/misc/consents.htm#a1
 “BRICS reach deal over development bank”, Aljazeera, March 27, 2013, online at: http://www.aljazeera.com/news/africa/2013/03/20133268641350653.html
 David Smith, “BRICS eye infrastructure funding through new development bank”, Guardian [U.K.], March 28, 2013, online at: http://www.guardian.co.uk/global-development/2013/mar/28/brics-countries-infrastructure-spending-development-bank
 The reason that many people, including many Marxists (also Stalin), expected that the Great Depression of the 1930s might resume after the artificial boom of World War II is that they failed to grasp Marx’s explanation for how capitalist overproduction crises are resolved. As Marx & Engels noted, even as early as the Communist Manifesto, such crises are resolved only through the destruction of excess capital or else through the opening up of extensive new markets. Since virtually the whole world was already opened to capitalism by the 20th century, the only way left to resolve a major overproduction crisis from that point on was through the massive destruction of productive capital. And World War II did just that, especially in Europe and Asia. The U.S. economy benefitted after the war by the capital destruction elsewhere (even though there was no war destruction at home); and because so much machinery and productive capacity wore out at home during the war; and because of the forced growth of savings during the war when consumers had nothing substantial to buy (e.g., cars and appliances).
 The initial plan for the BRICS Bank is that each of the 5 countries will put in equal amounts; the figure of $10 billion each has been mentioned. But China wants each country to put in a larger amount to begin with, and only China will likely be able to add the huge additional capital later that the Bank will almost inevitably need.
 There is a tendency that some people have to discount any possibility of growing economic contentions within the world imperialist system, and to deny even the possibility that different economic blocs might arise within the current world system, on the grounds that the U.S. currently has unchallengeable military power and unshakable military alliances with most of the other powerful countries of the world. We see this tendency as a sort of a neo-Kautskyian view similar to his theory of “ultra-imperialism”. First, it fails to take to heart the reality of uneven development in the world, and the genuineness of the rapid growth of Chinese economic power in particular, along with the U.S. economic decline and fragility. Second, it confuses the present situation of growing economic contention with the possible future development of military contention. Third, philosophically, it seems to reject the important dialectical law that “one divides into two”.
At the present time China cannot construct much of a “war bloc” against the U.S., except possibly with Russia. But that is not the issue now; no major interimperialist war is imminent (fortunately!). But economic contention is nevertheless developing rapidly, and will inevitably do so even more strongly as China continues to rise and the world economic crisis continues to develop.
 From the March 27, 2013, Aljazeera report mentioned in an endnote above.
 There are already signs of the increasing reluctance or inability of the U.S. to adequately fund the IMF and the World Bank. “Only recently Congress childishly refused to honor an agreed-upon increase in America’s financial commitment to the International Monetary Fund.” [Economist, Feb. 22, 2014, p. 8.]
 Turkey, for example, appeared to be relatively stable several years ago, but now shows increasing signs of economic weakness and political instability. It has had difficulties with Israel and in Syria, some differences of opinion with the U.S., and even the agreement with the Worker’s Party of Kurdistan (PKK) to end a long armed rebellion shows signs recently of breaking down. Since the European Union (which has very serious internal problems itself) has been giving the cold shoulder to Turkey, that country might well be attracted to any rising BRICS bloc.
 “German Foreign Policy: No More Shirking”, Economist, Feb. 8, 2014, pp. 49-50.
 Ibid., p. 50.