Benefits and challenges of being a partner of BRICS

 

From Jamil A Ghani

Malaysia’s recent entry as a partner country of BRICS, championed by Prime Minister Anwar Ibrahim, reflects his vision to boost economic growth and enhance the country’s geopolitical influence.

This collaboration offers both opportunities and challenges, necessitating a prudent approach.

Opportunities for economic diversification 

Participation alongside new members Egypt, Ethiopia, Iran, and the UAE presents avenues for trade within a bloc that includes founding members Brazil, Russia, India, China, and South Africa.

Collectively, BRICS represents over US$28.5 trillion (RM12.48 trillion) in GDP, or roughly 28% of the global economy, with nearly 45% of the world’s population.

This economic heft enhances our trade prospects and opens opportunities for meaningful engagement with emerging markets.

Anwar highlighted the strategic Straits of Malacca and Malaysia’s close ties with China, our largest trading partner, as key motivations for joining.

Advantages and limitations of partner status

While aligned with BRICS on economic and infrastructure initiatives, partner status does not provide the privileges of full membership, such as direct voting rights or influence over BRICS institutions like the New Development Bank and Contingent Reserve Arrangement.

Instead, Malaysia has opportunities for selective engagement in areas like non-dollar trade and discussions on global financial reform, without full institutional responsibilities.

This arrangement allows flexibility, enabling us to expand our economic networks while keeping the option of full membership open.

Implications for Asean 

Since independence, Malaysia has upheld a non-alignment policy to preserve its sovereignty and avoid major-power conflicts.

Building on these principles, Tunku Abdul Rahman led the nation into the Commonwealth and the United Nations, and co-founded Asean in 1967 to promote regional stability free from major power influence.

Abdul Razak Hussein continued this approach by establishing the Zone of Peace, Freedom and Neutrality in 1971, and normalising relations with China in 1974.

While potentially positioning Malaysia as a bridge between the two blocs, the BRICS partnership could influence Asean’s economic and foreign policy dynamics.

It may raise concerns within the region if other members perceive Malaysia as aligning too closely with BRICS powers like China.

To uphold Asean centrality, Putrajaya must manage its relationships carefully to avoid internal strife.

Anwar has assured that involvement in BRICS will not compromise Malaysia’s long-standing neutrality, a crucial factor in attracting foreign investments.

Geopolitical influence and strategic positioning

The BRICS partnership could enhance Malaysia’s geopolitical standing, offering a platform to advocate for developing countries and to support a more multipolar world order.

Anwar highlighted that joining BRICS aligns with our commitment to the Global South, challenging Western dominance in global affairs.

To maintain a balanced approach, he addressed concerns that engagement with the economic bloc could distance the country from its Western trade partners.

Anwar emphasised that the aim is to foster trade and cooperation rather than create divisions.

Citing India — a BRICS member with substantial Western economic ties — as an example, Anwar intends to maintain our relationships with the Asia-Pacific Economic Cooperation (Apec), Regional Comprehensive Economic Partnership (RCEP) and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to uphold a broad foreign policy framework.

Economic risks and governance challenges 

New trade and investment from BRICS countries offer growth potential, but over-reliance may introduce economic vulnerabilities.

Sanctions on Russia or a slowdown in China could have a negative impact on Malaysia’s economy as it deepens ties within the bloc.

To mitigate these risks, the government must continue to diversify its trade portfolio beyond BRICS to protect against external shocks.

Moreover, partnership involves navigating a variety of political systems and economic policies, which can complicate joint initiatives.

Malaysia needs to strategically balance its principles of transparency and rule of law with the bloc’s objectives, particularly in areas such as trade regulations, investment protection and technology transfer.

Domestic political considerations 

Entry into the economic bloc has drawn parliamentary scrutiny, with concerns that closer ties with countries like Russia and China could have an impact on our democratic values.

Anwar has reiterated his government’s commitment to democratic principles and the rule of law.

Maintaining transparency will be essential to address public concerns and ensure that the benefits of BRICS involvement are effectively communicated and widely understood.

Conclusion 

With neighbouring Indonesia also joining BRICS as a partner country and expressing interest in full membership, Malaysia’s timely involvement reflects strategic foresight in aligning with a bloc that advocates for a multipolar world order.

By adhering to non-alignment principles, broadening trade partnerships and selectively engaging within BRICS, Malaysia will enhance its regional influence and position itself within a non-Western coalition aimed at reforming global governance.

While this partnership does not grant direct decision-making power, it provides avenues for economic diversification and engagement with key emerging markets, reflecting a commitment to an inclusive global economy. - FMT

Jamil A Ghani is a PhD candidate at the S Rajaratnam School of International Studies, Nanyang Technological University, Singapore and an FMT reader.

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.