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GLOBAL POLITICAL RISK
Saudi Arabia has officially begun membership of the BRICS bloc. Saudi Arabia was one of five countries (along with Iran, UAE, Ethiopia, and Egypt) set to join the group on January 1 following invitations extended at the BRICS Summit in South Africa last August.
- The expansion doubles the size of the bloc and incorporates strategic nations in the Middle East central to Russian plans to limit economic isolation from western sanctions.
- The expanded grouping, which notably includes geopolitical adversaries Iran and Saudi Arabia, could also present a major obstacle to an ongoing US-led politically restructuring the Middle East through normalisation of relations between Saudi Arabia and Israel and extends China's influence into a region traditionally within the US sphere of influence.
- Ayham Kamel at Eurasia Group MENA said: “The prospect of Saudi Arabia, the UAE, Iran and Egypt joining Brics creates new mechanisms that force a degree of political cooperation by all the countries... The Arab countries are looking [to improve] their global geopolitical influence and appear committed to avoiding detachment from the West.”
- Bloomberg notes: "The five invitees sent senior-level representatives to a BRICS sherpa meeting in Durban, South Africa, earlier this month and they fully participated in the gathering, “a clear indication that they have accepted the invitation” to join, Anil Sooklal, Pretoria’s ambassador to the bloc, said in an interview Friday."
- Argentina declined their invitation to join the bloc following a pivot from new President Javier Milei.
Figure 1: BRICS Expansion (New Members: Yellow)
Source: Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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