BRICS has moved to the center of the debate over the future of globalization, expanding its ranks and ambitions as it seeks to rebalance economic power away from Western-led institutions. With Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates joining in 2024, the bloc now spans 10 countries that account for nearly half the world’s population and more than a third of global output on a purchasing-power basis.
From promoting local-currency trade and alternative payment rails to scaling development finance through the New Development Bank, BRICS members are testing ways to reduce reliance on the dollar, reshape supply chains and exert greater sway over energy markets. The push comes amid sanctions, geopolitical fragmentation and shifting commodity flows that have amplified the group’s leverage – and exposed its internal fault lines. Whether BRICS can translate momentum into durable institutions and coordinated policy is emerging as a key question for investors, multinationals and policymakers alike.
Table of Contents
- BRICS financial architecture reshapes capital flows with rising local currency settlements New Development Bank expansion in sustainable infrastructure and new cross border payment rails
- Supply chains and energy security recalibrated through critical mineral alliances green hydrogen pilots and port to rail corridors linking Africa Asia and Latin America
- What policymakers should do now adopt interoperable payment standards improve NDB transparency deepen local currency bond markets and coordinate debt restructuring to avoid fragmentation
- Closing Remarks
BRICS financial architecture reshapes capital flows with rising local currency settlements New Development Bank expansion in sustainable infrastructure and new cross border payment rails
A coordinated push by the bloc is redirecting capital toward its own markets as trade and project finance increasingly clear in local currencies, lowering dollar exposure and compressing hedging costs across select corridors; in parallel, the New Development Bank is scaling a pipeline of sustainable infrastructure using blended finance and local-currency issuance, while new cross‑border payment rails-from CIPS links and instant-pay interoperability to multi‑CBDC pilots-seek to cut frictions, widen access, and build resilience against external shocks.
- Capital flows: Trade invoicing in yuan, rupees, reais and rubles nudges liquidity into onshore markets and regional banks.
- Market structure: Central-bank swap lines and local FX market‑making deepen settlement capacity but expose basis and liquidity pockets.
- Debt financing: NDB expands local‑currency and sustainability‑linked bonds, crowding in private capital for grids, transit, and water assets.
- Payments plumbing: ISO 20022‑native rails, QR linkages, and multi‑CBDC corridors reduce costs and settlement times versus legacy networks.
- Geoeconomic reach: Energy and critical‑minerals contracts increasingly price in non‑dollar terms, reinforcing alternative benchmarks.
Supply chains and energy security recalibrated through critical mineral alliances green hydrogen pilots and port to rail corridors linking Africa Asia and Latin America
As member states prioritize resilience over just-in-time efficiencies, BRICS is stitching together cross-continental production routes and energy systems that dilute chokepoint risk, lift local value-add, and anchor new trade flows in the Global South, with state-backed lenders and sovereign funds tilting capital toward critical mineral offtakes, green hydrogen hubs, and port-rail logistics that fast-track raw materials to processing and manufacturing clusters while standardizing customs, data, and safety protocols for frictionless throughput.
- Critical mineral alliances: Long-term offtake agreements and co-investment in refining capacity to secure lithium, nickel, cobalt, graphite, and rare earths closer to the pit-to-plant chain.
- Green hydrogen pilots: Electrolyser deployments, derivatives (ammonia/methanol) trials, and port bunkering tests to decarbonize industry and maritime lanes.
- Port-to-rail corridors: Integrated concessions linking inland mineral belts to coastal gateways, reducing dwell times and diversifying away from overburdened sea lanes.
- Finance and risk-sharing: Development bank guarantees, local-currency settlement, and blended finance vehicles to derisk early-stage infrastructure.
- Standards and digitalization: Interoperable customs, traceability for ESG compliance, and data-sharing that tighten time-to-market and compliance assurance.
- Industrial spillovers: Co-located processing parks and supplier ecosystems that move participants up the value chain and stabilize energy demand profiles.
What policymakers should do now adopt interoperable payment standards improve NDB transparency deepen local currency bond markets and coordinate debt restructuring to avoid fragmentation
Amid rising monetary bifurcation, officials across BRICS and partner economies can lock in near-term, measurable gains by aligning digital rails, sharpening governance at the development-bank level, mobilizing local currency savings, and putting in place predictable rules for crisis workouts-steps that cut transaction costs, broaden market access, and curb the risk of parallel systems hardening into enduring financial blocs.
- Interoperable payment rails: Commit to end‑to‑end ISO 20022, shared QR and instant-pay standards, and an open API rulebook; enable PvP and DvP across RTGS systems; pilot cross‑border CBDC corridors with legal finality, AML/CFT and data‑privacy safeguards; publish conformance tests and open‑source reference code.
- NDB transparency and governance: Launch a real‑time project data portal with loan terms, procurement, and beneficial ownership; mandate independent audits, ESG safeguards and climate‑risk metrics; disclose board votes and pricing methodologies; expand co‑financing registers to avoid overlap and improve catalytic impact.
- Deeper local‑currency bond markets: Establish predictable issuance calendars and primary‑dealer networks; boost repo and CCP clearing; standardize documentation and CACs; provide FX‑hedging backstops and partial credit guarantees via NDB; prioritize green/sustainability and sukuk formats; clarify tax and withholding rules to draw in global index inclusion.
- Coordinated debt restructuring: Create a BRICS‑aligned, Paris Club-compatible platform with comparability of treatment; embed state‑contingent features (GDP/disaster clauses) in new debt; set standstill protocols and timelines; align treatment of bilateral, policy‑bank and SOE claims; share debt data through a common registry to accelerate workouts.
- Accountability and milestones: Within 12 months, target T+1 cross‑border settlement on priority corridors, a public NDB transparency scorecard, a 20-30% cut in average remittance/FX costs, and time‑bound restructuring frameworks-concrete benchmarks to deter fragmentation and anchor credibility.
Closing Remarks
As the BRICS consortium moves from rhetoric to implementation, its ability to convert scale into coordination will be the decisive test. The bloc now sits nearer the center of debates over trade rules, financial plumbing and the energy transition, with an agenda that spans local-currency settlement, development finance and supply-chain diversification. Yet divergent national priorities, governance standards and market credibility remain material constraints.
What happens next will be measured less in communiqués than in deliverables: bankable projects, interoperable payment rails and predictable regulatory frameworks. The response from established powers and the alignment of the wider Global South will shape the pace of change. Whether BRICS can translate ambition into durable outcomes will influence capital costs, commodity flows and, ultimately, the balance of economic power in the decade ahead.