The UAE, has officially joined the BRICS group of emerging economies. This is a huge milestone for the UAE and its people, and it will have a significant impact on its economy and future goals.
Table of Contents
What is the BRICS?
BRICS is an acronym for Brazil, Russia, India, China, and South Africa. These are five major emerging economies that have a combined population of over 3 billion people and a combined GDP of over $16 trillion. They account for about 40% of the world’s population and 30% of the world’s land area .
BRICS was formed in 2006 as a platform for cooperation and dialogue among these countries on various issues such as trade, investment, finance, health, education, energy, security, and innovation. The group holds annual summits where the leaders of the member countries discuss their common interests and challenges .
BRICS also has several institutions that support its activities, such as the New Development Bank (NDB), which provides financing for infrastructure and sustainable development projects in the member countries and other developing nations; the Contingent Reserve Arrangement (CRA), which provides financial assistance to the member countries in case of balance of payments crises; and the BRICS Business Council, which facilitates trade and investment among the private sectors of the member countries
Why did the UAE join the BRICS?
The UAE is one of the most prosperous and stable countries in the Middle East and North Africa region. It has a diversified economy that relies on oil and gas, tourism, trade, finance, logistics, manufacturing, and innovation. It has a population of about 10 million people and a GDP of about $421 billion .
The UAE has been pursuing a strategic vision to transform itself into a knowledge-based economy that can compete globally and achieve sustainable development. It has invested heavily in education, health, infrastructure, renewable energy, space exploration, artificial intelligence, and digital transformation. It has also established strong diplomatic relations with many countries around the world .
The UAE joined BRICS in 2023.
The UAE has been a long-term partner of the BRICS group, having participated in June’s ‘Friends of BRICS’ forum in Cape Town, convened as part of the BRICS Foreign Ministers Meeting, chaired by the Republic of South Africa.
The UAE’s decision to join BRICS was motivated by several factors:
- The UAE saw the BRICS as an opportunity to enhance its economic ties with some of the largest and fastest-growing markets in the world. The UAE already has substantial trade and investment links with China and India, which are its top two trading partners. The UAE also has significant potential to expand its cooperation with Brazil, Russia, and South Africa in various sectors such as agriculture, mining, energy, tourism, and technology
- The UAE also saw the BRICS as a platform to share its experience and expertise with other developing countries that face similar challenges and opportunities. The UAE has achieved remarkable progress in diversifying its economy, reducing its dependence on oil revenues, improving its governance and human development indicators, and fostering innovation and entrepreneurship. The UAE can offer valuable lessons and best practices to other BRICS members and partners on how to achieve economic growth and social welfare.
- The UAE also saw the BRICS as a forum to contribute to global peace and stability. The UAE has been playing an active role in promoting regional and international security, humanitarian assistance, mediation, and dialogue. The UAE believes that BRICS can be a positive force for multilateralism and cooperation in addressing global issues such as climate change, poverty reduction, pandemic response, terrorism prevention, and nuclear non-proliferation.
What benefits will it bring?
The UAE’s membership in BRICS will bring many benefits to both the UAE and the other BRICS members. Some of these benefits are:
- Increased trade and investment opportunities: The UAE will have greater access to the large and dynamic markets of the BRICS members. The UAE will also be able to attract more foreign direct investment from these countries by offering them a favourable business environment, a strategic location, a skilled workforce, a modern infrastructure,
and a stable political system. The BRICS members will also benefit from the UAE’s role as a regional hub for trade and commerce that connects them with other markets in the Middle East, Africa, Europe, and Asia. - Enhanced financial cooperation: The UAE will be able to tap into the resources of the NDB
and the CRA to finance its development projects and support its economic stability. The UAE will also be able to participate in the decision-making and governance of these institutions and influence their policies and priorities. The other BRICS members will also benefit from the UAE’s financial contribution and expertise in these institutions. - Strengthened innovation partnership: The UAE will be able to collaborate with the other BRICS members on research and development, technology transfer, intellectual property protection, and innovation ecosystem development. The UAE will also be able to leverage the talent and creativity of the other BRICS members to enhance its own innovation capacity and competitiveness. The BRICS members will also benefit from the UAE’s innovation leadership and vision in fields such as renewable energy, space exploration, artificial intelligence, and digital transformation.
How will it affect the UAE's economy and future?
The UAE’s membership in BRICS will have a positive impact on its economy and future. Some of these impacts are:
- Increased economic growth and diversification: The UAE’s membership in BRICS will boost its trade and investment flows, create new markets and opportunities, generate more jobs and income, and stimulate more economic activity and productivity. The UAE’s membership in BRICS will also help it diversify its economy away from oil dependence and towards more value-added and knowledge-based sectors.
- Improved economic resilience and sustainability: The UAE’s membership in BRICS will enhance its financial stability and security, reduce its exposure to external shocks and volatility, and increase its fiscal space and flexibility. The UAE’s membership in BRICS will also help it achieve its environmental and social goals, such as reducing its carbon footprint, increasing its renewable energy share, improving its human capital, and ensuring its social inclusion and cohesion.
- Elevated global status and influence: The UAE’s membership in BRICS will raise its international profile and reputation, increase its voice and representation in global forums and institutions, and strengthen its strategic partnerships and alliances. The UAE’s membership in BRICS will also enable it to play a more active and constructive role in shaping the global agenda and addressing the global challenges.
Conclusion
Sheikh Shakhboot bin Nahyan Al Nahyan, Minister of State, stated, “We express our appreciation regarding the agreement of the leaders of the BRICS countries on the inclusion of the UAE in this important group as of January 2024, and we are grateful for their confidence in this regard. The UAE seeks to support multilateralism and partnerships to achieve development, prosperity and benefit for all countries and peoples.”
The UAE’s membership in BRICS is a historic achievement that reflects its economic success and diplomatic prowess. It is also a strategic move that will bring many benefits to the UAE and the other BRICS members. It is also a visionary step that will affect the UAE’s economy and future in a positive way. The UAE’s membership in the BRICS is a win-win situation for all parties involved.
