Perspective

Is Global South Modern?

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– Natasya Aulia

MODERNITY IS OFTEN understood as a product of European history that was then imposed as a universal standard for the world. This paradigm places the Global South as an entity that is always lagging behind, “less modern,” and must catch up by imitating Western development models. However, an important question that now arises is to what extent the Global South is able to define its own standards of modernity, not only as a critique of Eurocentric modernity, but also as an operational alternative. Through conceptual studies and case studies from Asia, Latin America, and Africa, evidence has emerged of a shift towards contextual plural modernities, although still overshadowed by structural obstacles such as financial and technological dependence (Fikriyah, 2024).

 

[ Russia based Political Philosopher Alexander Dugin on Global South and Modernity in an exclusive interview with COGGS. ] 

Historically, the category of the “Global South” was born not as a geographical description, but as a political construct rooted in the legacy of colonialism and Western-biased modernization. (Fry, 2017) emphasizes that the Global South was shaped by relations of domination that not only deprived it of resources, but also destroyed the value systems, knowledge, and future orientation of societies in the South. Modernity, in this case, cannot be separated from colonialism, which created conditions of “ruination” and ongoing dependency. This understanding shows that the Global South’s efforts to define standards of modernity are essentially an attempt at decolonizing knowledge (decoloniality) that seeks to dismantle old epistemic structures.

The concept of “multiple modernities” developed by Einstadt (2000) offers a theoretical framework for understanding these dynamics. Rather than a single linear path toward Western modernity, modernity can be understood as a plural process rooted in the traditions, institutions, and histories of each society. In the context of the Global South, multiple modernities are evident in the combination of global technology adoption and local values, such as the digitization of public services in India linked to social inclusion, or the solidarity economy model in Brazil that emphasizes distributive justice. In other words, the Global South is not only a consumer of modernity but also a producer of alternative standards.

However, the process of articulating plural modernities in the South is not easy. Structural barriers remain strong. A report (Aynaoui et al., 2023) published by ISPI, ORF, and PCNS shows that although the economies of the Global South now contribute a significant proportion of global GDP, political representation and decision-making capacity in international institutions remain uneven. For example, BRICS, which collectively controls 26% of global GDP, only has 14% of the votes in the IMF, an indication of epistemic and institutional injustice that hinders sovereignty in determining development standards. In these conditions, the discourse on epistemic sovereignty becomes increasingly relevant.

Indonesia and the ASEAN region provide concrete illustrations of how the Global South is attempting to negotiate its own modernity. As a country with a long colonial history, Indonesia has developed a development model that attempts to combine democracy with local cultural plurality. Meanwhile, ASEAN collectively promotes the concept of the ASEAN Way, which emphasizes consensus and non-intervention, a governance model that is often considered “unmodern” by Western standards, but is functional in maintaining regional stability (Fikriyah, 2024). Similarly, India, with its Digital India program, is not simply adopting Western technology, but emphasizing national data sovereignty. Brazil, through its social policies, presents a form of modernity that emphasizes the distribution of welfare, while South Africa seeks to articulate modernity through the discourse of Ubuntu, which emphasizes collectivity.

Although the discourse on the Global South is growing stronger, we must not turn a blind eye to the potential for fragmentation within it. As noted by (Shield, 2021), the term Global South often oversimplifies reality, given that countries included in this category have different political interests, economic orientations, and historical experiences. Differences in attitudes toward global issues, such as responses to the war in Ukraine or the humanitarian crisis in Gaza, demonstrate that solidarity within the Global South is not always linear or consistent. Therefore, when discussing alternative modernity from the Global South, it is important to avoid viewing it as a homogeneous bloc. It is precisely this internal diversity that needs to be taken into account so that the proposed standards of modernity do not lose their legitimacy or relevance.

In the context of policy design and cultural practices, (Fry, 2017) asserts that criticism of Eurocentrism is only the first step. What is more urgent is to build a knowledge ecosystem based on the needs, values, and local realities of communities in the Global South. This means that the Global South must develop a policy architecture that tangibly supports sovereignty standards, whether in the form of technology regulations, digital data governance, or development indicators that are more sensitive to social and environmental contexts. If the Global South has often been in a position of being determined by global actors, now is the time to move towards becoming an active actor that determines its own path, not only in discourse but also in institutional practice.

The concept of sustainment proposed by Fry (2017) is crucial to understanding the new direction of modernity in the Global South. Sustainment emphasizes the importance of maintaining a sustainable relationship between design, modernity, and the survival of the planet. This sustainment-based model of modernity opens up space for the Global South to offer new standards that differ from the Western model of extractive industrialization. Examples can be found in renewable energy programs in Africa that emphasize local community solutions, or in digital economy practices in Asia that expand women’s participation. The report (Aynaoui et al., 2023) also highlights that more and more Southern countries are beginning to link their development agendas to principles of social inclusivity and environmental sustainability, rather than solely economic growth.

Overall, the question “Can the Global South define its own standards of modernity?” can be answered with cautious optimism. There is ample empirical and conceptual evidence showing that Southern countries are moving towards a form of modernity that is more in line with local needs and values. However, significant obstacles remain, ranging from financial dependence on international financial institutions, technological dominance by developed countries, to global knowledge hegemony that places Western theories and experiences as the main benchmark.

Therefore, efforts to build a Global South version of modernity cannot stop at criticizing the West, but must be realized in the form of strong policy development, regulations that favor domestic interests, and an independent knowledge ecosystem. This challenge is also a great opportunity. If successful, the Global South can show that modernity does not have to mean imitating European or American models, but can arise from the historical experiences, cultures, and creativity of Southern societies themselves. In other words, modernity from the Global South has the potential to bring about new standards that are more inclusive, fair, and sustainable for the world.

 

[ Natasya Aulia is an Indonesian intern at COGGS and student of International Relations.]

Is Global South Modern? Read Post »

What makes the SCO Resilient?

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The Shanghai Cooperation Organization (SCO) has set a model for a new type of international relations, Chinese President Xi Jinping made the remarks while addressing the 25th Meeting of the Council of Heads of State of the SCO in China’s Tianjin on September 1. The member states were the first to put forward the vision of global governance featuring extensive consultation and joint contribution for shared benefit as an effort to practice true multilateralism,  President Xi said.

Against protectionist headwinds, true multilateralism is what the international community has called for several times.Under this vision, the SCO’s remarkable development over 24 years has propelled it into a vital platform for regional security, economic collaboration, and international diplomacy, demonstrating a model of multilateralism rooted in mutual trust and respect.

“We were the first to conclude a treaty on long-term good-neighborliness, friendship and cooperation, proclaiming our commitment to forge lasting friendships and refrain from hostilities,” Xi added.

Over the past decades, the SCO has made substantial strides in fostering mutual political trust and safeguarding regional security. What was initially founded as a security group has evolved into a comprehensive organization representing a quarter of global GDP over the years.

China’s investment stock in other SCO member states has exceeded $84 billion, and its annual bilateral trade with other SCO member states has surpassed $500 billion. Chinese companies have established over 3,000 enterprises in other SCO member countries, generating an average of more than 200,000 employment opportunities annually, according to China’s Ministry of Commerce.

This year’s summit has further consolidated these gains, reaffirming the SCO as a stabilizing force amid turmoil.

Xi pledged to provide 2 billion yuan ($281 million) in grants to SCO member states this year. The country will also issue an additional 10 billion yuan ($1.4 billion) in loans to the member banks of the SCO Interbank Consortium over the next three years. Pragmatism is a key word that was stressed several times in Xi’s Monday remarks. This perhaps explains the SCO’s increasing popularity on the international arena.

It is worth noting that this year’s summit is the largest in SCO history, reflecting the organization’s expanding membership and influence. The organization has now expanded into a 26-nation family spanning Asia, Europe and Africa.

This growth enhances the SCO’s significance as an alternative model for regional cooperation compared to Western-dominated organizations.

The inclusion of diverse members underscores the SCO’s appeal as a platform where sovereignty and non-interference are respected while pursuing common goals of security, economic development, and cultural exchange. This adherence to core principles has made the SCO attractive to countries seeking balanced partnerships.

China, as a founding member, has proposed the Belt and Road Initiative, the SCO Interbank Consortium and others to strengthen this vision of a shared future.

Hosting the summit in Tianjin is a showcase of China’s commitment to leading a cooperative, multipolar world order. China, on several occasions, has clearly indicated its dedication to making the SCO not just a forum for dialogue but a substantive actor in global governance.

This set the tone for the summit’s agenda, aiming to chart the course for a high-quality, sustained partnership among member states. China’s focus on equality, mutual respect, and shared growth resonates within the SCO framework, enhancing the organization’s appeal and influence.

 

This year’s summit comes at a challenging time. But the SCO’s enhanced cooperation mechanisms and expanding appeal underscore its relevance in today’s multipolar world. The SCO Tianjin Summit has further cemented the organization’s role in fostering a stable, prosperous and interconnected region, embodying the enduring “Shanghai Spirit” and setting a precedent for the future of international cooperation.

[ This article is republished from CGTN’s First Voice  under a content syndication arrangement. The views expressed are those of CGTN.] 

What makes the SCO Resilient? Read Post »

Europe and the Global South: A Maltese Perspective in a New Era of Conflict

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– Dr. Christian Cardona
Europe stands today at a turning point. The wars in Ukraine and Palestine have revealed more than just the fragility of its security architecture. they have exposed the erosion of Europe’s credibility. By defending sovereignty and international law in one conflict while appearing to ignore them in another, Europe has invited the charge of double standards. The Global South has noticed and, crucially, it is no longer content to remain silent.
The Global South is not the passive partner of yesterday. It is a dynamic bloc of states shaping trade, energy markets, and diplomatic agendas across the globe. In the UN, at the G20, and through coalitions like BRICS, the South is setting terms rather than merely receiving them. For Europe, this is not a challenge to be managed but a reality to which it must adapt. Without meaningful engagement, Europe risks isolation in a world that is increasingly multipolar.
For Malta, these shifts are not distant abstractions. Our geography places us at the crossroads of Europe, Africa, and the Middle East. regions where the strength of the Global South is already tangible. We see it in the growing assertiveness of African states demanding fairer migration and trade policies, in the energy partnerships that link the Mediterranean to the Gulf, and in the moral clarity with which Latin America and others speak about Palestine. The South is no longer waiting for Europe’s permission it is charting its own course.
Vibrant image of the Maltese flag waving proudly against a clear blue sky, showcasing Malta's national pride.
Prime Minister Robert Abela of Malta has rightly raised these realities within the European Council, urging Europe to move beyond selective morality and embrace a consistent vision of peace and security. Likewise, Foreign Minister Ian Borg has underlined that Malta’s diplomacy must be rooted in dialogue and neutrality, principles that give us credibiAdd a heading (1)lity as a bridge between continents.
But credibility is also undermined when Malta’s voice at the highest European level becomes indistinguishable from that of larger powers. Roberta Metsola, as President of the European Parliament, has too often served as an unquestioning mouthpiece for Brussels’ dominant interests. Her readiness to adopt strong positions on Ukraine while remaining hesitant, or silent, on Palestine reflects exactly the inconsistency that alienates the Global South. In moments of crisis, leadership demands independence and courage. To simply echo the agenda of the powerful is not leadership but abdication.
What Europe must now accept is that the Global South is not asking for recognition but is demanding it. Its collective economic power, demographic weight, and moral authority are reshaping the balance of the international system. Europe can either engage with this reality as an equal partner, or it can continue clinging to outdated hierarchies and watch its influence fade.

[ Agency is more important than Geography: Dr. Cardona on Global South at Global South Economic Forum 2025, Abu Dhabi, hosted by COGGS and AGDA] 

Malta understands this better than most. As a small state, we know that influence does not come from size but from credibility. And credibility today means consistency — consistency in upholding international law whether in Kiev or in Gaza, consistency in dialogue, and consistency in respecting the equal voice of the South. The wars of our time should be Europe’s wake-up call. A Europe that dismisses or lectures the Global South will be a Europe left behind.
[Dr. Cardona is former Economy Minister of Malta, International Trade Law Specialist and Advisor COGGS.  The views expressed are solely those of the author and do not necessarily represent the official position of COGGS.]

Europe and the Global South: A Maltese Perspective in a New Era of Conflict Read Post »

Bears, BRICS and Garudas: How Indonesia “Socialized” with Russia?

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Andhini Octa Maharatih and Alinda Rana Permata Surya

 

On the sidelines of the 28th St Petersburg International Economic Forum , June 18-21 2025, Russian President Vladimir Putin held a meeting with President of Indonesia Prabowo Subianto during his state visit. [Photo: RIA Novosti/ Kremlin Photo Bank. ]
◉  THE RELATIONSHIP BETWEEN Indonesia and Russia has been warm since before Indonesia’s independence. Russia (the Soviet Union) played a role in supporting Indonesia’s independence and actively advocated for its right to sovereignty. Even after Indonesia officially gained independence, cooperation between Indonesia and Russia (the Soviet Union) has continued to this day, beginning during the era of Indonesia’s first president, Soekarno. The closeness between Indonesia and Russia has been reflected in strong diplomatic relations and bilateral cooperation since 1950—five years after Indonesia became an independent nation. These diplomatic ties have been mutually beneficial. Early on, Indonesia purchased a pair of fighter jets and two helicopters from Russia. In return, Russia requested payment in the form of Indonesia’s primary commodities, such as rubber and palm oil.

In addition to defense and economic cooperation, Moscow offered several scholarships for Indonesian students to study in the nation. Nikita S. Khrushchev, the Soviet leader at the time, warmly welcomed Indonesian students to the University of Russia in Moscow in 1960. Infrastructure development, such as the construction of the Bung Karno Stadium, was also credited largely to Soviet support.

 

Why Indonesia Prefers Russian Defence Supply Over American?  

Indonesia has viewed Russia as a strategic partner in defense and security technology development. In addition to being a producer of modern weaponry, Russia offers relatively low prices and simpler regulations for defense equipment sales. Although Indonesia has not yet fully developed its own defense equipment, Russia has shown openness to technology transfer, allowing Indonesia to modify and adapt this technology domestically. This contrasts with the United States, whose strict regulations are seen as less favorable to Indonesia. As a result, Russia has become a more attractive partner for long-term defense and diplomatic cooperation.

Although relations cooled after the Indonesian Communist Party’s (1965 G30S) rebellion—when Indonesian students in Russia were repatriated—ties gradually improved after the political situation stabilized.

 

New Order and Post-Suharto Era

During the New Order regime, Indonesia leaned more toward the West due to the lingering effects of the communist threat. Under President Soeharto, Indonesia’s relationship with Russia began to recover after 22 years, marked by a diplomatic visit to Russia in 1989.

Following this, Indonesia entered a difficult period of political transition, facing domestic conflicts that required inward focus. Relations with Russia improved again under President Megawati Soekarnoputri, the fifth President of Indonesia. Under her leadership, cooperation that had stalled was revived in 2003, especially in technology and economic development.One example was the cooperation between Vneshtorgbank and PT Bank Mandiri to support Indonesia’s banking system during a global financial crisis. Although Megawati’s presidency was brief, she reopened channels for engagement between the two nations.

President SBY’s Era

President Susilo Bambang Yudhoyono (SBY) continued and expanded this cooperation. Beginning in 2007, SBY intensified Indonesia’s bilateral relations with Russia, focusing on new areas such as investment, defense, and natural resources—including bauxite, aluminum, oil, and gas. These areas marked a new phase in Indonesia–Russia cooperation.

President Susilo Bambang Yudhoyono also promoted soft power diplomacy, particularly in tourism, and collaborated with Russia in defense modernization. Cooperation included technology transfers to Indonesia’s domestic defense industries such as PT Pindad, PT Dirgantara Indonesia, and PT PAL.

Indonesia’s closeness with Russia was evident during SBY’s presidency, especially in economic sectors. For instance, palm oil exports—although only 2% of Indonesia’s total exports in 2011—were considered significant. When talks of Indonesia joining BRICS arose, SBY remained neutral, stating that Indonesia was transitioning from a developing to an emerging economy and aimed to strengthen its national economy before joining.In competing for the Russian market, Indonesia faced challenges, especially from European countries dominating exports. To increase competitiveness, Indonesia sought to promote exports of automotive products, footwear, tires, and furniture. Trade between Russia and Indonesia increased by 4.9% in the 2011–2014 period for non-oil and gas sectors and continued to improve in 2016.

 

Jokowi’s Era, Connectivity and Strategic Expansion

Under President Joko Widodo (Jokowi), Russian investment in Indonesia significantly increased. Jokowi encouraged local governments to establish sister-city relationships to attract long-term and sustainable investments. Several sister-city partnerships were established, including:

  • Jakarta–Moscow (continued from SBY’s era)
  • Palembang–Belgorod
  • Yogyakarta–St. Petersburg
  • Magelang–Tula

The nature of these city connectivity projects are different, while all of them cementing Indonesia- Russia ties. The Magelang–Tula partnership, for instance, is based on similarities in geographical conditions. Tula is an advanced city in industry and agriculture, while Magelang, located between Mount Merbabu and Mount Sumbing, has a cool climate suitable for highland farming. The partnership, however, focuses more on public services, branding, economic development, and environmental management.

Meanwhile, the Yogyakarta–St. Petersburg partnership emphasizes cooperation in arts, culture, tourism, and education—proving effective in strengthening diplomacy during the Jokowi era. Long-term investments were also pursued, such as the oil refinery in the Jenu area, Tuban. This refinery, under cooperation between PT Pertamina and Russian company Rosneft, has been under construction since 2016 and is projected to process 30 million liters of fuel daily, with a capacity of 320,000 barrels per day. This project aims to enhance national energy security and reduce fuel imports.Despite geopolitical challenges such as the Russia–Ukraine conflict, Indonesia maintains a neutral, “free and active” foreign policy—supporting Ukraine’s independence while still partnering with Russia.

 

Indonesia in BRICS

[Foreign Minister of Indonesia Sugiono during the arrival of head of delegations at Kazan Expo to attend the 16th BRICS summit in Kazan, Russia. Kirill Zykov / BRICS-KAZAN- RIA Novosti]
Indonesia’s diplomatic presence is expected to grow further following its entry into BRICS on January 6, 2025. This move comes amid a global trade war triggered by U.S.-imposed tariffs. BRICS aims to challenge Western dominance, particularly that of the U.S. and its allies. Indonesia’s entry strengthens the bloc and provides new opportunities for economic cooperation. As a BRICS member, Indonesia can benefit from easier access to Russian defense technology and increased investment opportunities. Russia, in turn, sees Indonesia as a vital partner in Southeast Asia and a gateway to ASEAN markets. This partnership opens new avenues for cooperation in energy, technology, defense, and trade. On the global stage, both nations are likely to support each other in international forums—especially regarding world order reform, state sovereignty, and support for Palestine. Indonesia’s free-active foreign policy adds value to BRICS, helping position the bloc as an alternative for developing nations beyond Western influence. However, Indonesia must balance its global diplomacy carefully, ensuring that closer ties with Russia do not strain its relationships with Western nations like the U.S. and EU. With Indonesia joining BRICS and Russia seeking to expand its global influence, the bilateral relationship is expected to become more intensive, strategic, and mutually beneficial.

Also Read: The Falcon and Bear Braving a Storm: UAE and Russia in the Dawn of Multipolarity

[ Andhini Octa Maharatih and Alinda Rana Permata Surya are interns at COGGS from Surabaya, Indonesia, and students of International Relations at UPN Veteran Jawa Timur University. The opinions expressed do not reflect the views of COGGS. ] 

 

 

Bears, BRICS and Garudas: How Indonesia “Socialized” with Russia? Read Post »

Singapore’s Dual Identity: Heart of Global South, and Soul of North?

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Alvino Adian Denata

SINGAPORE, A SMALL nation in Southeast Asia that achieved independence in 1965, has become one of ASEAN’s most prominent economic powerhouses. With a high average income, quality of life and a good bureaucracy, Singapore has a good reputation in the global arena, compared to neighbouring countries, one of the proofs is that Singapore’s passport is the strongest passport in the world. The rapid development in the fields of technology, health, education and fast infrastructure makes the condition of Singapore become stable and become a country in the spotlight of the world. This article will briefly discuss Singapore’s journey from a small colonial trading post to a global financial centre, and will also analyse how it has evolved to challenge traditional classifications of the country and highlight the complexities of its dual identity.

Historical Context : From Colony to Economic Power House

In 1819, Stamford Rafles of the British colony, first landed in the area today known as Singapore to establish a post point for strategic trade needs, especially for British colonies in the Southeast Asian region. Until 1824, the territory officially fell to the British from the Sultanate of Johor. Within just few years, Singapore, along with Penang and Malacca, formed the Straits Settlements under the British which later became a Crown Colony. Over the years Singapore developed as a port and a point of attraction for traders from various parts of the world, until the end of World War II where the Japanese power managed to weaken British power, which was used by Singapore to achieve self-government under the British Commonwealth.  Singapore joined the Malaysian federation on 16 September 1963, which lasted for two years.  Then decided to become independent on 9 August 1965.

Under the leadership of Lee Kuan Yew, Singapore significantly transformed into a highly developed country, starting with implementing rapid industrialisation and building industrial zones to attract foreign investment, as well as focusing on human resource development. Singapore also focused on opening up to multinational companies by providing infrastructure, legal and tax guarantees that became a major attraction. By investing heavily in education, they are able to produce a skilled and productive workforce. Singapore has made its way into the world’s spotlight after experiencing an average GDP increase of 7% since independence and achieving a 9.2% increase per year in the first 25 years. Continuing to focus on education, infrastructure and technology, Singapore is fast becoming a first world country in the third world region in less than half a century.

Identity Classifications: Global South or  Global North?

However despite Singapore’s rapid economic development, the country is still classified under the Global South classification, due to its geographical and cultural ties. So, what really is the difference between the Global South and the Global North?

The global south is defined as a region occupied by developing or even underdeveloped countries. It is generally located in the southern hemisphere, and is often associated with a history of colonialism. In some scholars’ views, the global South is regarded as a region that serves as a means of exploitation for the North in the world order of global capitalism. On the other hand, the North is defined as a group of developed countries that have large economic, political, economic and dominance powers. The North is considered as the controller of the world, as a form of dependence, seen in the utilisation of the South’s raw natural resources that provide many benefits to the North, while the return is the destruction of the earth’s environment.

The division of these two economic groups is not entirely correct, because many criteria overlap and sometimes do not match the grouping labels they get compared to the facts on the ground, such as Singapore. As a reminder, this grouping is not only oriented towards regions, but rather economic inequality and strength in the global arena. From the facts and notions constructed, this classification creates a metaphorical narrative, which cannot be fully interpreted. In the current era, many developing countries have finally erased the boundaries of the North and South in the contemporary era, which means that identities and classifications are no longer appropriate. So is this classification actually based on the division of the world, economically, or is it just a paradox for the sake of global domination of the big countries in the north, which massively control the major world bodies.

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The Paradox of the North and the South: Singapore’s Perspective

Despite having a strong history and culture with the global South, Singapore is well qualified to enter this world-dominated region from an economic and institutional perspective. With a GDP per capita of USD 82,000 (2023), Singapore can even rival the GDP figures of the United States and Switzerland. With rapid alignment in technology, standard of living and quality, Singapore is getting closer to the North in this regard. Singapore is also an economic centre with institutions such as MAS, which can compete with similar institutions in the US. Singapore is home to over 1,000 multinational companies, with a stable legal, political and economic climate. With a human development index score (reaching 0.939 in 2022), Singapore has been able to improve the level of health services, education and reduce crime, which is almost equivalent to the welfare of Nordic countries.

In terms of more general international relations theory, namely dependency theory, the South tends to be highly dependent and trapped in a long cycle with the North, while Singapore is the centre of all sectors that the South depends on the North. From the explanation above, clearly, the substance and function of Singapore is a North World country. This grouping is really just a homogenising label that forgets other factors.

Singapore has a unique situation that doesn’t fit neatly into usual categories. It isn’t clearly part of the Global South, which usually includes countries that are less developed or have trouble getting resources, nor is it like the typical Global North countries because of its location and culture. This mix of things creates a confusing situation. Even though Singapore is very wealthy, similar to many Northern countries, its income inequality is closer to that of poorer nations. This is shown by its Gini coefficient, which is around 0. 38 after taxes and transfers.

Singapore relies heavily on labour from South Asia, which is often paid low salaries and works in sectors such as construction and domestic care. The government conducts elections, but the People’s Action Party (PAP) has been in the lead for many years. The system is often criticised for not providing much freedom, which is in contrast to South Korea’s liberal system. However, the system helps maintain the country’s stability, which is considered important in the South. Singaporeans enjoy a lifestyle influenced by global trends such as Western media and products, but remain connected to Asian traditions. It shows that with strong leadership, investment in human capital, and openness to international trade, a small country lacking natural resources can be successful. But it also raises questions about equity, resilience, and preserving cultural identity in an increasingly globalised world. Singapore’s success is a good example for developing countries, showing that rapid modernisation can be achieved with tight management and a practical economic plan. However, its small size, lack of natural resources, and unique history make it difficult for other countries to replicate its model. In addition, the use of strict government control has fuelled discussions about the balance between freedom and development. Singapore shows that economic growth can happen alongside cultural and geographical differences, challenging the usual idea that only Northern countries set the standard for what it means to be developed.

Conclusion

Singapore is a clear example of how the global classification between the ‘Global South’ and the ‘Global North’ no longer fits today’s reality. On the one hand, geographically and historically, Singapore is at the centre of the global South-rooted in a context of colonialism, territorial dependency and limited natural resources. But on the other hand, the country has evolved into an entity that operates with the ‘soul’ of the global North-high standards in terms of technology, education, economic stability, and institutional structures.

This contradiction becomes clearer when we realise that even though Singapore has the same or even better development indicators as the North, it still falls under the South. This suggests that this classification is more of a geopolitical construct than an accurate reflection of a country’s condition. Moreover, Singapore demonstrates the irony of modernity: a highly developed country that still faces high income inequality; an economically efficient and competitive country, but with tight political control; a country that is considered a model of development, but is difficult for other developing countries to emulate because of its uniqueness.

Singapore is not only an exception, but also a challenge to the dominant narrative of development. As such, Singapore stands as a paradox of global identity: it is a ‘Global South country that has become a globalised nation. So why is the country with the world’s strongest passport still being debated?

 

[ Alvino Adian Denata is an intern at COGGS and student at Department of International Relations, UPN “Veteran” Jawa Timur, Surabaya, Indonesia. The opinions expressed are the author’s own. ]

References

Chase-Dunn, C. &. (1995). Discusses global economic structures, core-periphery model relevant to Global North-South. World-Systems Analysis. Annual Review of Sociology, 387-417.

Elkan, R. v. (1995). Singapore’s Development Strategy. In M. K. Bercuson, Singapore A Case Study in Rapid Development (p. 75). Washington DC: International Monetary Fund.

SG101. (2025, July 16). 1959-1965: Early Economic Strategies. Retrieved from https://www.sg101.gov.sg/: https://www.sg101.gov.sg/economy/surviving-our-independence/1959-1965/

Zhou, P. (2025, May 8). The History of Singapore’s Economic Development. Retrieved from https://www.thoughtco.com/: https://www.thoughtco.com/singapores-economic-development-1434565

 

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Cryptocurrency in Global South Trade: The Iran Case Study Analysis | Read Now|

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Vericko Dhuha Zahir Negara, COGGS Intern

[Abstract : This research looks at how cryptocurrency’s role is becoming more important as an alternative in international trade, especially for countries that are not well-supported by the usual global financial system. As the SWIFT network is being used more often as a tool for political reasons to apply sanctions and control economies, many countries particularly in the Global South are looking for alternative solutions. Cryptocurrency, which is based on blockchain technology, allows people to send money directly to each other without needing banks. This reduces reliance on traditional financial institutions, cuts down on costs, and makes it easier to send money across borders quickly. Using the World-Systems Theory and the concept of Decentralized Finance, this study shows how blockchain-based currencies give countries like Iran more control and stability by helping them avoid sanctions and manage their economy better. The research used a qualitative-descriptive approach, looking at information from academic papers, news articles, and reports from organizations to spot trends. The results show that cryptocurrency’s role helps trade happen in ways that traditional systems don’t allow, and it changes how global economics works by being a clear, fast, and politically neutral option compared to conventional systems. ]

 

INTERNATIONAL TRADE IS an important aspect for a nation to increase its economic growth. One of the biggest elements of international trade is the Society for Worldwide Interbank Financial Telecommunication also known as SWIFT, which has been the backbone of banks from various nations. However, SWIFT is not a neutral system; it has been used as an international political tool in the form of sanctions and other economic limitations (Cipriani et al., 2023). SWIFT works as a safe communication provider between banks, because of that almost any transnational currency operates under SWIFT. As a result, anytime when a nation or company has limited actions by SWIFT it can result in an economic crisis or a bankruptcy. This phenomenon of economic limitations has increased over time due to SWIFT not being a neutral system. SWIFT has increasingly become a political control tool to give sanction and limit any country’s economic activities if that country is considered a threat. This results in cost issues and regulatory restrictions that blocks developing countries from reaching not only western market but also the global market to gain a higher profit. For example, most Global South nations are submitted to this system which creates unequal dependency and makes them

vulnerable to sanction and other political-economic pressure. For that reason, many nations and companies tried to find a way to do international trade without relying on SWIFT’s system. This led them to blockchain technology, which uses cryptocurrency that was invented by an unknown individual called Satoshi Nakamoto back in 2009. Blockchain eliminates the needs of banks correspondent, documents, and time needed. Cryptocurrency offers real-time transaction or remittance, low cost, and direct access from buyer to seller without relying on banks.

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[Iranian saffron and pistachios are famous for quality and highly in demand in the US market, despite sanctions]

Theoretical Framework

This research was conducted using the World-System theory as a way of understanding the world as a hierarchically structured capitalist system, with a dominant core and an exploited periphery (Wallerstein, 2004). According to Wallerstein, the capitalist world system began around the 16th century in Europe, through colonial expansion, international trade, and the formation of modern nation-states. Since then, this system has continued to develop into a global system with one hegemony that switches over time. World-systems theory supports an interdisciplinary approach by integrating historical, political, economic, and cultural analysis within a measured framework. On top of that, this research will also apply the Decentralized Finance (DeFi) concept. DeFi is a new model in the finance world that utilizes blockchain technology and smart contracts to provide financial services without intermediaries like banks (Zetzsche et al., 2020). This technology allows users to access financial services by peer-to-peer with just the internet and digital wallet. DeFi allows users to avoid traditional or conventional ways of international transaction or remittance which is more costly and time-consuming. As a whole, DeFi is a model that changes how transnational finance activities work.

Methods

Every data was collected through in-depth literature studies, news articles, academic publications, and any documents related to blockchain, cryptocurrency, and SWIFT. On top of that, data analysis was carried out by identifying patterns, themes, and narratives that emerged from the collected data, which were then interpreted. This approach allows the author to describe things in detail while keeping it concise. In addition, the qualitative-descriptive method enables the author to remain adaptable to the different matters of the subject regarding international trade. This method aims to provide understanding of the dynamics of the phenomenon being studied.

iran, banner, flag, international, iran, iran, iran, iran, iran

 

The  Case of Iran 

Global South countries’ challenges are often stacked on top of another with systemic issues, international actors interfering, lack of facilities or technology, and internal economic issues. This creates a demand for trusted and self-custodial currency which led to digital coin using Blockchain technology (Böhmecke-Schwafert & Moreno, 2023). Cryptocurrency and blockchain offer faster, cheaper, and more accessible cross-border transactions, such as remittances and trade, while avoiding international restrictions. Due to many Global South countries facing both internal and external trade challenges, this pushes them to switch to a currency that can avoid those challenges. The implementation of Blockchain in the Global South can improve the Global South’s position and profit as a raw material supplier within the global supply chain, rather than being limited by conventional trade systems. Blockchain’s transparency and traceability facilitate Global South in international trade especially for agriculture and natural resources (Eliason, 2022). Even with the risk of being hacked and losing digital coins, the trend of utilizing cryptocurrency is not slowing down, instead it creates other ways to store digital coins such as using cold wallets. Global south countries develop domestically controlled blockchain and support cryptocurrency legal matters to increase digital currency exposure and trust around the world. On top of that, blockchain and cryptocurrency should also support local manufacturers, SMEs, cross-border trade, and remittances among Global South citizens (Eliason, 2022).

Since the United States withdrew from the JCPOA nuclear deal in 2018, Iran has been re-imposed on \economic sanctions. These sanctions primarily target Iran’s oil sector and financial system. As a result, Iran’s currency exchange rate has plummeted, while inflation has sky-rocketed. In this economic state, both the Iranian government and civilians have begun seeking alternative, more stable stores of value and exchange rates. One widely used solution is cryptocurrency. There are several key reasons why crypto has become so attractive to Iran. First, cryptocurrencies are used as a hedge against inflation and currency devaluation. Many Iranians store their wealth in crypto, which is considered more stable than conventional currencies. Second, cryptocurrency allows the government and businesses to evade international sanctions, particularly from the US. Since 2019, the government has officially supported Bitcoin mining, taking advantage of cheap domestic electricity. On top of that, Iran uses crypto as a digital currency for export commodities. In August 2022, Iran began using crypto directly to pay for imports. The government is also exploring the use of gold-backed digital coins with Russia to strengthen bilateral transactions and avoid the US dollar and SWIFT. This move by Iran sparked a response from the international community. The US government expanded its list of sanctioned entities, including companies in the United Arab Emirates, Turkey, and Hong Kong that help Iran sell oil and launder money through crypto. The US Treasury Department has also increased cooperation with blockchain intelligence agencies to track suspicious transactions. However, the effectiveness of this law enforcement remains limited as Iran actively seeks new ways to evade detection, including through anonymous decentralized finance protocols. Because of that, International policy needs to be more integrated to both support cryptocurrency as an alternative for international relations actors to have a new trade system that is operated under blockchain technology.

 

iran, mosque, tehran, middle east, persien, iran, iran, iran, iran, iran, tehran, tehran, tehran, tehran, persien

Conclusion

Cryptocurrency has caused a big shift in how countries trade internationally, especially for those facing difficulties in the current global financial system. SWIFT, which is a system that has been used a lot in international banking, is sometimes controlled by politics and can limit certain countries from accessing the global market, especially those in the Global South. Cryptocurrency offers a different way for these countries to take part in the economy. It works through blockchain technology, which doesn’t need third parties like banks. This makes transactions faster, cheaper, and more open. This is especially helpful for countries that are under sanctions or facing financial limits, like Iran. Cryptocurrency also helps more people and businesses around the world to take part in financial activities. With decentralized finance, people can connect directly with others without needing traditional banks. This is especially useful for small businesses and even governments. On top of that, blockchain’s ability to track transactions helps in areas like farming and exporting raw materials, which are important for many countries in the Global South. This makes their role in global trade stronger. Though there are risks like hacking and unclear rules, more people are using cryptocurrency, showing how important it is. In the end, cryptocurrency is a brand new technology that gives people more control over their money and challenges the conventional financial systems. It creates new paths for trade that are fairer, more open, and not controlled by political power or banks.

 

[ Vericko Dhuha Zahir Negara is a COGGS Intern and Student at International Relations
Faculty of Social and Political Sciences National Development, University “Veteran” of East Java, Surabaya, Indonesia]

 

References

  1. Marco Cipriani, Linda S. Goldberg, & Gabriele La Spada (2023). Financial Sanctions, SWIFT, and the Architecture of the International Payment System.
  2. Slatvinska Valeria, Demchenko Vitaliia, Tretiak Kateryna, Hnatyuk Rostyslav, & Yarema Oleg (2022). The Impact of Blockchain Technology on International Trade and Financial Business. DOI:10.13189/ujaf.2022.100111
  3. Patrick Schueffel (2021). DeFi: Decentralized Finance- An Introduction and Overview
  4. Dirk A. Zetzsche, DouglasW.Arner, & Ross P. Buckley (2020). Decentralized Finance
  5. Immanuel Wallerstein (2004). World-System Analysis An Introduction.
  6. Rose Mahdavieh (2022). State Adoption of Cryptocurrency: a Case Study Analysis of Iran, Russia, and Venezuela.
  1. Moritz Böhmecke-Schwafert & Eduardo García Moreno (2023). Exploring Blockchain-based Innovations for Economic and Sustainable Development in the GlobalSouth: A Mixed-Method Approach based on Web Mining and Topic Modeling.
  1. Antonia Eliason (2022). BLOCKCHAIN, TRADE, AND THE GLOBAL SOUTH:

ENTRENCHING SUPPLY CHAIN ROLES.

  1. Reuter (2025). S. issues additional Iran-related sanctions, Treasury website shows.
  2. Arab News (2022). How Iran is cashing in on cryptocurrencies to evade US sanctions.

 

Cryptocurrency in Global South Trade: The Iran Case Study Analysis | Read Now| Read Post »

Why BRICS, Global South need Angola?

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[ The piece is syndicated from The Week, followed by Angolan President João Lourenço’s maiden visit to India. The title of the article differs from the article published in the Indian magazine. Author is a fellow and content editor at COGGS. ]

Ayanangsha Maitra

POWER MAY ONCE have been spilled from the barrel of a gun, but Angola is showing the energy-starved Global South that today, it flows from the barrel of crude oil. As Angolan President João Lourenço visited India on his maiden trip to India earlier this month (May 2-4), two nations from opposite ends of the world found themselves co-architects of a new multipolar order.

President Lourenço—a former freedom fighter who took up arms to liberate the motherland from Portuguese colonial rule—reached New Delhi at a time when both countries are pushing to reform global institutions and rebalance power dynamics. His visit is more than ceremonial; it signalled the elevation of India-Angola ties into a deep partnership grounded in energy, defence, technology, and developmental aspirations.


India is already one of Angola’s largest buyers of oil and gas. Now, the relationship is expanding far beyond hydrocarbons. Following bilateral talks, both countries committed to deep cooperation in digital public infrastructure, space technology, defence, diamond processing, healthcare, and critical minerals. India has offered a $200 million defence credit line to modernise Angola’s armed forces and will help train its military personnel.

Sitting on the southwestern coast of Africa,  Angola is working to reduce its economic dependence on oil by attracting investments from China, the UAE, and Portugal, particularly in infrastructure, ports, railways, and energy. India, too, sees an opportunity: the potential introduction of Indian diesel locomotives and the expansion of Angola’s railways—especially into mineral-rich regions—could be transformative. As India’s Economic Envoy Dammu Ravi noted, “There is a possibility to introduce Indian diesel locomotives and also expand the railway network interior, north-south and east-west and leading into the areas of their minerals, which are very important for them in terms of logistics.”
 
Despite $4.2 billion in bilateral trade, Angola enjoys a major surplus. India imports around $3.5 billion—mostly oil—while exporting less than $700 million in goods such as medicines, meat, textiles, cotton, chemicals,  leather items, tractors, and vehicles. Angola sends iron, copper, aluminium, and other minerals in return, apart from energy. Reducing this imbalance will require India to push for better market access and explore investment-led growth in Angola.

Angola is habitat to around 8,000 people of Indian origin and has recently implemented visa-free entry for Indian citizens to promote tourism and business. The historical links are not just symbolic. Goa and Angola, once colonies under Portuguese rule, share cultural resonances. Pandurang Shirodkar, the first speaker of the Goa legislative assembly and an early supporter of Angola’s independence, was imprisoned and deported to Angola by the colonial regime—an overlooked but powerful connection.
India inspired and supported Angola’s liberation movement, and post-independence, India  backed the Popular Movement for the Liberation of Angola (MPLA). The two are vocal at the forums like Non-Alignment Movement.

Unlike India, Angola’s real soft power doesn’t lie in cultural exports like Bollywood or the Taj Mahal. Instead, it lies in Sonangol, its oil giant. Formed in 1976, the state-owned Sonangol is now Africa’s second-largest oil producer and one of its most diversified corporations, with stakes in telecoms, shipping, engineering, and even shipbuilding. The company’s PAENAL shipyard hosts Africa’s largest heavy-lifting crane—a symbol of Angola’s industrial ambition. India is already partnering on key infrastructure projects such as the Moçâmedes Railway and sees potential for deeper collaboration in satellite technology, where ISRO could play a future role. Angola currently works with Russia and France on space applications, but India’s affordable space programme offers an attractive alternative.

Angola also holds growing geopolitical relevance. As chair of the African Union—whose entry into the G20 was strongly backed by India—Luanda is poised to shape continental strategies. Its ties within the Community of Portuguese Language Countries (CPLP) also give it leverage in Latin America, especially Brazil. The cultural and strategic alignment with lusophone nations puts Angola at the crossroads of continents and makes a link between Latin America and Africa.
 
Moreover, Angola’s recent role as a mediator in the Rwanda- DR Congo peace talks and President Lourenço’s strong condemnation of the Pahalgam terror attack highlight its emergence as a responsible global actor. As Angola discovers new oil fields, India’s expertise in refining, transport, and energy infrastructure could play a vital role in translating resources into growth.
 
Angola’s participation in the India-led Coalition for Disaster Resilient Infrastructure, Big Cat Alliance and Global Biofuels Alliance would be a transformative episode. Yet the challenge remains: to ensure this relationship doesn’t plateau at trade. Without active investment, deeper cultural exchange, and expanded cooperation, passive trade imbalances could undercut long-term goodwill. This is the moment to build a robust, reciprocal trade partnership—one that connects Luanda and New Delhi, Mumbai, Bengaluru, Mysore, Calcutta and Goa not just through products, but through values, and opportunity. Angola’s position within BRICS—attending summits and maintaining separate ties with each of the BRICS nations—further cements its strategic weight. If BRICS expands further in Africa, Angola could become a cornerstone in fulfilling the energy and development needs of the Global South. Private companies from Russia and India should exercise a greater role to make the nation glitter, by penetrating into areas like agri-tech.

However, to address the persistent trade imbalance, India must seek greater market access in Angola and across the region. A passive trade dynamic risks undermining the healthy and warm relationships between the two aspiring global south powers.

 

 

Why BRICS, Global South need Angola? Read Post »

How Europe is Reframing WWII

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  • Jean-Pierre Page

WESTERN EUROPEAN VIEWS on the Second World War and the painful past have evolved significantly. Today its interpretation is at the heart of national and international political contentions. The Conservative Revolution of the 1980s saw a depoliticisation of history, reversing the post-war trend to understand history from the perspective of the dominated, notably under the impetus of social and political struggles and the decolonisation movement. Today, history has become the domain of the media, cultural industry and public authorities, and the analysis propagated is not restricted to a shared concern for independent and non-partisan historical research, but instrumentalised to legitimise neoliberalism and US hegemony as the sole horizon of history, the only alternative.

However, the world is changing, and changing fast. It is not Francis Fukuyama’s end of history. The international balance of power has altered dramatically, and the contradictions have become more acute. The end of the Second World War and the defeat of fascism ushered in a new period of history. Anti-fascism gave way to anti-Communism. The Cold War that followed, the fall of the Berlin Wall, and the disappearance of the Soviet Union were decisive events that had political, economic, and military consequences, particularly for Europe. The abolition of existing borders and Western aggrandisement with NATO expansion raised crucial issues related to collective security, state sovereignty and high-risk conflicts.

 

 

 

The global context is marked by a US-led unipolar world order facing a systemic crisis, including one posing an existential threat to European institutions. As we see from the war in Ukraine, sovereignty is the main obstacle to the preservation of the established order. The West and the political and economic model that it represents is in decline, highlighted by the revival of Russia, the undeniable rise of China on the world stage, and the emergence of anti-hegemonic alliances. Western bids to counter this decline at whatever cost, preserve US hegemony, and give legitimacy to its actions are at the origin of the political and ideological efforts to impose a different understanding and interpretation of history, resulting in its manipulation and the propagation of fables and untruths  . 

This re-writing of history has to do with Washington’s agenda to impose on the rest of the world a new system of ‘global governance,’ a nebulous ‘rules-based order,’ founded on US supremacy and unilateralism. Rooted in the ideology of American Exceptionalism and Manifest Destiny, it denigrates alternative cultures as inferior and unworthy, dividing the world into superior and inferior, civilized and uncivilized, liberal and illiberal, good and bad. It has now been conceptualised in terms of ‘democracy versus autocracy’ and wielded as a weapon in Washington’s bloc politics and bloc confrontation, subverting the UN Charter-based multilateral system founded on respect for the sovereign equality of States and the right of peoples to self-determination. 

 

And it is toward this end that all the world’s media, so-called experts, complacent academics, NGOs, and think-tanks that the United States can rely upon are being mobilized. In unison, they rattle off the same argument: “Russia is at our doorstep implementing a Machiavellian plan to dominate Europe, the earth, and also the stars!” Why not the entire universe, one may ask  ? For the cause, China is thrown in, identified with Russia, and the emphasis is made how complementary their strategies are. Under threat of being accused of complicity with Vladimir Putin, any challenge to this new doxa is prohibited  ! 

Recently a US media outlet proclaimed that it had been US troops that liberated Auschwitz, before retracting and apologizing for the error. In one of its first surveys, France’s oldest polling institute, IFOP, posed the following question at the end of the Second World War, repeating it 70 years later: “Which nation do you think contributed most to the defeat of Germany in 1945? Great Britain, the United States, or the USSR?” At the end of the War, over 60% of French responded it was Russia. Only 20% said it was the United States, and 12% the United Kingdom. Seventy years later, in a reversal of opinion, 58% believed it was the United States that had played the main role in Germany’s defeat.

It is to serve this hegemonic project that, in 1986, the gigantic Caen Memorial Museum in France was created with substantial US funding, as part of the International Network of Museums for Peace. It was dedicated to the history of the 20th century and to peace and given a special role to rewrite history. It contains gross historical errors. In 2002, several exhibition halls were added, devoted to the Cold War, the fall of the Berlin Wall, and the Holocaust, highlighting only the role of the United States in the Normandy Landing as late as 6 June 1944.No mention is made of the head of the Soviet Union Joseph Stalin as having officially first raised the question of opening a second front three years earlier, on 18 July 1941.

In the same spirit, in September 2019, the European Parliament voted a resolution stigmatising Nazism and Communism alike, claiming that the second world war had been triggered by the German-Soviet Pact: “… 80 years ago on 23 August 1939, the communist Soviet Union and Nazi Germany signed a Treaty of Non-Aggression, known as the Molotov-Ribbentrop Pact … which paved the way for the outbreak of the Second World War”. 

By reducing the origins of the Second World War to the “German-Soviet Pact,” the resolution places both Nazi Germany and the USSR on equal footing, considering both responsible, despite no serious historian, with a few rare exceptions, ever having questioned the aggressors as Nazi Germany, fascist Italy and imperial Japan. By supporting the text, the European parliamentarians disavow the conclusions of the Nuremberg Tribunal, equating those who built the Auschwitz extermination camp with the Red Army that liberated the survivors.

 Was it not the Nobel laureate for literature, Thomas Mann, who once wrote: “To place Russian communism on the same moral level with Nazi fascism, because both are totalitarian, is, at best, superficial, in the worse case it is fascism.”? 

The European Parliament has thus conferred legitimacy on a vision of history that has to do with pure propaganda, one that is silent on the policy of appeasement and the complicity of the ruling classes of most Western countries with Hitler’s Germany. Hence, its failure to mention the Munich Agreement, the Anschluss, or the period of collaboration between, for instance, Nazi Germany and Pétain’s France and the latter’s zealous roundups of Jews. The Vel d’Hiv roundup in Paris on16 and 17 July 1942 was the ordeal of 13,000 men, women, old people and children deported to the gas chambers of the extermination camps, including Auschwitz. They were among the 75,000 Jews in France who suffered the same fate. 

A tragic history that demands decency and humility has today given rise to a dishonest amalgam between the Holocaust, anti-Semitism, the events of October 7, Gaza and the Palestinian struggle. It is as if, in a distorted logic, Palestinians are at the root of a resurgence of anti-Semitism associated with the Nazis and Auschwitz. Establishing such a link with a struggle of a people for self-determination and decolonization is intolerable and unacceptable. It must not be forgotten that the establishment of the Jewish state on Palestinian land is the result of a link made by Western powers between Palestine and the problem of Jewish refugees in Europe, victims not of Arab, but of European anti-Semitism, with its ultimate expression in Nazi extermination camps. 

The hypocritical rhetoric accompanying the exercise of re-writing history ironically disqualifies the very liberal order that its authors seek to preserve. “Make America great again,” “rebirth of the Germanic spirit,” or “civilizing mission of colonization,” which some Western politicians claim as their right, only serve as diversion from their own culpability for plunder, slavery, devastation, predation, and genocide.

The European Parliament’s resolution actively participates in the erasure of all traces of history. It legitimises the renaming of streets, the nostalgic neo-Nazi demonstrations, and the destruction of historical monuments celebrating the Red Army’s contribution to the victory over fascism, as in the Baltic states or in Ukraine. And all the while, it disregards the heroic patriotic and partisan struggles in all of Europe. 

On 17 January 2024, the European Parliament engaged in yet another exercise on the past, adopting a new resolution that no longer contents itself with a call to rewrite history, but a call to erase all traces and create “a new shared culture of remembrance”. Member States are, for instance, called upon to update their existing curricula and teaching methods so that European history takes precedence over national history in order, we are told, to challenge the stereotypes and “sacred cows” of national histories.

It is hardly surprising that critical thinking is being replaced by slogans and emotional narratives, simplifying facts and impoverishing public debate. Society is being restricted in its ability to analyse its own past, its complexities and contradictions with all their nuances. The rise of revisionist narratives and “alternative truths” bears witness to the devaluation of rigorous historical analysis, eroding the legitimacy of academic, scientific and educational institutions, weakening them and compromising their essential role as guardians of history. 

This simplification and instrumentalisation of history has devastating effects as once unifying symbols become subjects of discord. We are warned of the dangers ahead and alerted to our responsibility toward the younger and future generations to lead this struggle for History with a capital ‘H’.

 

[ This article was originally published by the Valdai Discussion Club under the title ‘How Europe Is Rewriting WWII History.’ COGGS is republishing it with an edited title. The author, Jean-Pierre Page, is a French writer and trade union activist.]

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Indonesia’s Quest for Influence: Bridging Indo-Pacific and Global South | COGGS|

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Balaji Chandramohan

Being one of the foremost economic players in the Southeast Asia, Indonesia holds a significant role in the Global South and plays an increasingly significant part in the Indo-Pacific region’s geopolitics. Its strategic location, at the intersection of the Indian and Pacific Oceans, has positioned it as a key player not only in regional dynamics but also on the global stage.

Indonesia’s Geo-Strategic Importance

Indonesia occupies a vital geo-strategic location in the Indo-Pacific, connecting Asia to the Southern Hemisphere and controlling crucial maritime routes. The country straddles two significant regions—the Indian Ocean and the South-west Pacific—making it a central hub for global trade routes. The Strait of Malacca, one of the busiest and most important maritime passages in the world, runs through its territory, emphasizing Indonesia’s importance in maintaining regional stability.

24 Sea Ports on Indonesia.

Strategic Impact of Indonesia’s Location

Indonesia’s location enhances its geopolitical significance, as it governs key sea lanes vital for global shipping and energy transportation. This proximity to vital maritime chokepoints has prompted Indonesia to reframe its security strategy, focusing on maritime defense and becoming a key player in Indo-Pacific security.

Indonesia’s Evolving Maritime Strategy

In response to the evolving Indo-Pacific security landscape, Indonesia has shifted its defense focus toward maritime security. The country has unveiled a new maritime doctrine, signaling a departure from its previous inward-facing security approach.

Modernizing Indonesia’s Navy
As part of this shift, Indonesia has initiated a naval modernization plan to expand its capabilities and assert its presence in the Indo-Pacific. The plan includes the creation of a ‘green-water’ navy, with a target of 274 naval ships by 2024. This ambitious project is Indonesia’s most significant naval expansion in over four decades, aiming to enhance its maritime defense and regional influence.

Indonesia’s Growing Diplomatic and Strategic Influence
Indonesia’s maritime strategy is also supported by its growing diplomatic outreach. The country’s enhanced profile in the Indo-Pacific region has prompted it to broaden its diplomatic initiatives and strengthen ties with key players in the region and beyond.

Indonesia’s Role in the U.S. Indo-Pacific Strategy

Indonesia in IndoPacific. Courtesy: X https://x.com/marc_saxer/status/1764861807095926836

Indonesia is becoming increasingly important in the United States’ pivot to the Indo-Pacific, serving as a crucial partner in the region’s balance of power. The country is considered a “gateway” between Eurasia and Australia, regions with growing influence in the Global South.

Indonesia’s expanding diplomatic network and strategic importance reflect its ambition to become a major player in regional geopolitics, with a focus on strengthening relationships within the Global South.

Economic Growth and Maritime Reach


Indonesia’s economic trajectory has supported its growing geopolitical role. Following significant reforms during the presidency of Susilo Bambang Yudhoyono (2004-2009), Indonesia has experienced robust economic growth, driven by a rising domestic consumption and increasing commodity exports such as palm oil, copper, and rubber. These reforms have not only enhanced Indonesia’s economic standing but also facilitated its maritime expansion.

Economic Reforms and Strong Growth
Indonesia’s economic reforms—including improvements in tax systems, customs, and fiscal management—set the foundation for continued growth. This robust economic performance positions Indonesia as a rising power in the Indo-Pacific, capable of investing in strategic areas such as defense modernization and military expansion.

Indonesia’s Defense Modernization and Military Expansion
To ensure its continued strategic relevance, Indonesia has embarked on an ambitious plan to modernize its armed forces. As part of the 2010 Strategic Defence Plan, Indonesia aimed to develop a minimum essential force by 2024, enhancing both its navy and air force. Indonesia has finalized a $300 million agreement to acquire 12 ANKA drones from Turkey, with deliveries scheduled for late 2025. Furthermore, the Ministry of Defense has recently signed a contract with France’s Thales for the purchase of long-range military radar, a deal expected to include technology transfer and the enhancement of Indonesian personnel’s skills. However, Indonesia spends less than 1 percent of its GDP on defense, a stark contrast to Singapore, which allocates around 3 percent of its GDP despite being a smaller country.

Strengthening Indonesia’s Military Capabilities
Indonesia’s military modernization efforts include the development of a modernized navy, submarines, and combat aircraft. By increasing its defense budget and focusing on strategic areas, Indonesia is working to position itself as a major maritime power in the Indo-Pacific. These upgrades will allow Indonesia to project its influence and contribute to regional security.

Indonesia’s Future Role in Global Geopolitics
Looking ahead, Indonesia is poised to become an even more influential geo-political player in the 21st century. The country’s evolving maritime strategy and defense capabilities will solidify its position as a key partner in efforts to maintain regional stability in the Indo-Pacific.

Indonesia’s Role in the Global South

As a founding member of the Non-Aligned Movement, Indonesia’s growing maritime and economic influence provides it with a unique opportunity to strengthen its role in the Global South. The country’s evolving defense capabilities and strategic alliances will further cement its position as a crucial player in the geopolitics of the Indo-Pacific region and beyond.

In conclusion, Indonesia’s strategic outreach reflects its ambitions to solidify its position within the Global South. With a growing maritime capability, expanding economic influence, and evolving defense strategy, Indonesia is positioning itself as a key actor in the geopolitics of the Indo-Pacific region. As the country continues to modernize its military and strengthen its diplomatic efforts, it is poised to become a central force in shaping the future of the Indo-Pacific and contributing to global stability.

[ Balaji Chandramohan is a Chennai, India based geopolitical analyst and former visiting fellow with Future Directions International, Australia. The views expressed in this article do not reflect those of COGGS.]

Indonesia’s Quest for Influence: Bridging Indo-Pacific and Global South | COGGS| Read Post »

Global South’s Impact on Peace and Equity: Under-Secretary-General Erik Solheim’s Insights

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Erik Solheim, former Under-Secretary-General of the United Nations and Co-Chair of the Europe-Asia Center, highlighted the significant role of the Global South in promoting a more peaceful and equitable world
amid historical Western dominance. He made the comment, while delivered a significant address at
the Global South Think Tank Forum in Beijing, organized by Chinese broadcaster CGTN.

Solheim began by reflecting on the last two centuries, a period dominated by Western powers, particularly European colonial forces and the United States, which wielded considerable influence over global affairs. While acknowledging the advancements in science and industry during this era, he emphasized the accompanying social injustices, including racism and colonial oppression.

Solheim is a diplomat and former Politician, served in the Norwegian government from 2005 to 2012 as Minister of International Development and Minister of the Environment. He was  Under-Secretary-General of the United Nations and Executive Director of the United Nations Environment Programme from 2016 to 2018.

The central theme of Solheim’s remarks was the emergence of the Global South, particularly nations like China and India, which he characterized as key players in this transformative phase.

He described this rise as a “positive development” that promises a fairer and more sustainable world,
contrasting the Global South’s focus on sustainability and inclusive prosperity with the historical practices of Western powers.  In concluding his remarks, Solheim expressed optimism for the 21st century, envisioning it as a time of increased peace and prosperity. He pointed to regions in Asia where large populations coexist without conflict as models of this promise.

Solheim highlighted the peaceful nature of major Global South countries, a few key points:

China has not engaged in military conflict for the past 45 years.
India has only been involved in conflict with neighboring Pakistan since its independence.
Other Global South nations, such as Indonesia, Brazil, South Africa, and Nigeria, have refrained from military aggression against other countries.

This emphasis on non-aggression suggests that the Global South is poised to play a commendable role in promoting global peace, which Solheim identifies as a crucial asset in the evolving geo-politics. Solheim proposed the creation of a multipolar world where diverse nations coexist and collaborate. He articulated a vision in which:

The United States, China, India, and Europe all play significant roles in global governance.
It is essential to acknowledge the unique political systems of each nation; he asserted that the U.S. will not adopt the Chinese political model, nor will China adopt the American one.

Principles of Respect and Dialogue

To facilitate cooperation in this new multipolar context, Solheim emphasized two foundational principles:

Respect: Mutual respect among nations is essential for fostering collaboration on prosperity, environmental sustainability, and peace.

Dialogue: Open communication is crucial for addressing differences, particularly regarding contentious issues such as conflicts in Ukraine and Gaza, as well as economic and environmental policies. The former Under Secretary argued that constructive dialogue can lead to resolutions and understanding, positioning these principles as necessary for a stable global order.

 

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Why Gulf Cooperation Council Needs to Act to Illuminate Global South

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Ayanangsha Maitra, COGGS

As the sand is shifting, the Global South nations need more sunlight to emerge from darkness.  The South nations need both a hand as well as a compassionate during their transition towards prosperity. Despite the strong bonhomie that the Gulf Cooperation Council (GCC) shares with the countries in Africa, Latin America, and South Asia, the council’s overall influence and camaraderie within the Global South remain very limited. Established in 1981, the GCC, the hexad club, is a union of Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain, and Oman.

Over the decades, Arab-African ties have scaled newer heights. Dubai is now the New York of Africa. On the flip side, the Gulf region too is finding Africa more interesting due to its minerals, resources, huge human habitat, hardworking skilled workforce, and emerging economies. The diversity of the continent is highly appealing. But as an organization, the Gulf Cooperation Council still lacks a sharp vision to strategically enhance its influence in the Global South.

GCC in Africa

Worried about the increasing influence of China and Russia in Africa, the US has begun urging the United Arab Emirates, Qatar, and Saudi Arabia to take on a larger role in Africa. Last year, GCC companies unveiled 73 Foreign Direct Investment (FDI) projects in Africa, totaling over $53 billion. Among the GCC nations, Kuwait has historically played a remarkable role in shaping Arab-African relations, being the first Arab country to host the Arab-African Summit in 2013. Agility, a Kuwait-based global logistics firm, is actively working to encourage foreign direct investment (FDI) and facilitate access for multinational companies to the African economies.

The UAE stands out as a significant player, currently the fourth-largest investor in Africa after the European Union, China, and the United States. In 2021 alone, the Abu Dhabi Fund for Development allocated approximately $16.6 billion to over 66 projects across 28 African countries. Additionally, Dubai Ports World has established itself as a leader in port expansion and maritime collaboration, managing operations in more than 10 African nations. DP World is pumping $80 million to develop a 300,000-square-meter logistics park in Sokhna, Egypt, in partnership with the Suez Canal Economic Zone, while also securing a 30-year contract to upgrade and manage sections of Tanzania’s Dar es Salaam port.

group, children, boy

Over the past decade, GCC countries have made significant strides in their investments in the continent, collectively surpassing capital of $100 billion. The United Arab Emirates leads the charge with an impressive $59.4 billion invested across various sectors. Saudi Arabia follows with $25.6 billion, focusing on infrastructure, energy, and technology projects. The other GCC nation, Qatar, has contributed $7.2 billion, primarily targeting strategic investments in areas such as real estate as well as hospitality.

Africa’s social challenges remain a concern for Saudi Arabia too. Saudi Arabia is actively engaging African countries with proposals for debt reduction and conflict resolution.

During its G20 chairmanship in 2020, Saudi Arabia emphasized the need for suspending debt service obligations for African nations. Several GCC investments are often criticized for prioritizing short-term returns over sustainable development. To maximize its influence in Africa, the GCC must contemplate a more strategic approach.

GCC in Latin America

In the Latin American region, the Council’s footprint remains minimal despite significant opportunities. In the early 2000s, ties between the GCC and Latin America were revitalized as both regions committed to enhancing their relationship through political exchanges and bilateral initiatives. The inaugural Summit of South American-Arab Countries (ASPA), hosted by Brazilian President Luiz Inácio Lula da Silva in 2005, played an immense role in strengthening ties, leading to the signing of an Economic Cooperation Framework Agreement between the GCC and MERCOSUR. Despite geographical distance, formal exchanges between the GCC and Latin America saw a remarkable surge in trade during the 2010s. Gulf states significantly increased imports from Latin America, with Brazil, Mexico, Chile, and Argentina being key contributors. In recent years, Gulf countries have exported goods like fertilizers, plastic polymers, aluminum, ammonia, and oil to Latin America. Latin America has exported iron ore and manufactured aluminum to the Gulf on the other hand.

portrait, man, people

Brazil is the main trade partner for the GCC in Latin America, but a substantial trade deficit exists there. Uruguay and Panama enjoy a favorable trade balance with the GCC. Saudi Arabia has a keen interest in mining and minerals within Latin America. The Saudi Public Investment Fund (PIF) is planning to invest approximately $15 billion in Brazil, focusing on sectors such as green hydrogen, infrastructure, and renewable energy. Additionally, the UAE’s state-owned defense technology firm, EDGE Group, has acquired a 50% stake in the Brazilian high-tech weapons systems company SIATT.

What Can the GCC Do in the Global South?

It’s high time for the GCC to act in the Global South for mutual prosperity. The Global South represents large markets for the GCC, and the Council should seek to enhance its influence in these fast-emerging economies.

The behemoths and venture capitalists belonging to the GCC are expected to flex their muscle in the continent. Substantial economic investments can be a game changer, which in turn makes the ties between the Gulf and Africa stronger. As GCC countries are diversifying their investment portfolios and actively seeking opportunities in sectors such as infrastructure, technology, and renewable energy, the Global South would be a perfect destination for investment.

Areas of infrastructure projects, transportation, and telecommunications are highly lucrative. The UAE has invested in numerous projects across Africa to enhance connectivity as well as increase local economies. Qatar has completed projects aimed at improving water security in drought-stricken Global South nations. The GCC may identify new geographies in the Global South for capacity building and high-impact community infrastructure development. At times of crisis, the GCC nations have extended help to nations in Africa on humanitarian aid grounds. Similarly, the Council can consider empowering more local leaders and enhancing institutional capacity in the Global South. To uphold its position at the global level, the GCC should no longer be just a bloc of elite nations but should position itself at a higher stage for its contribution through impact as well as impression, leaving lasting works. The GCC is missing its clout in the Global South and the potential in those economies. Promotion of public-private partnerships (PPPs) in developing nations would widen the Council’s avenues for economic growth.

 

References:

  1. Africa and the Gulf states: A new economic partnership | World Economic Forum (weforum.org)
  2. DP World allocates $80mln to develop logistics area in Sokhna (zawya.com)
  3. South-South Solidarity and the Summit 
of South American-Arab Countries – MERIP
  4. Saudi Arabia’s PIF plans to invest $15 billion in Brazil, says Brazilian minister | Reuters

 

Why Gulf Cooperation Council Needs to Act to Illuminate Global South Read Post »

Why BRICS Needs Ruh – a Soul?

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Ayanangsha Maitra

BRICS, the Panch Pandavas or a pentagon of power is opening its doors to new members, despite facing a barrage of sanctions and a flurry of allegations. Iran, Saudi and several oil rich nations inclusion has made the group more energetic. One thing is crystal clear: BRICS, having built itself “brick by brick,” is now aiming to “cement” its place in the global hierarchy.

flag, china, brazil

Among the Five members,the most thrilling story is that of the love-hate relationship between Dragon and Elephant. The strategic ambiguity between India and China, marked by differing perspectives and a lack of trust, has contributed to the stagnation of BRICS in some ways.

India and China may clash fiercely like rival firebrands, but they also trade like old friends haggling over a market stall. It’s a curious dance of diplomacy—one moment, they’re at each other’s throats, and the next, they’re swapping goods as if they’re in a bustling bazaar. No matter how heated our verbal sparring with  China gets, we can’t ignore that it’s ByteDance, the brains behind TikTok, that has truly transformed the worlds of dance, broadcasting, and self-expression. TikTok isn’t just a platform; it’s where foreign ministries and state officials spin their press engagements into viral gold. After banning TikTok, India tried to launch its own alternatives, but let’s be real—none have come close to matching TikTok’s flair or popularity.

While concerns about data centers and local laws loom large, Western companies are relishing the opportunity to tap into India’s rapidly expanding digital audience. If BRICS wants to keep up, it needs to shake off its old bureaucratic ways and get in tune with the current trends.

The tragedy of lives lost to preventable issues like inadequate healthcare and the absence of mosquito nets underscores the urgency for BRICS to evolve and address these critical concerns. Ignoring such realities, BRICS can’t gain value. With Iran, Saudi Arabia, and the UAE on board, BRICS nations are responsible for around 44% of the world’s crude oil. It’s high time BRICS stepped up to meet the energy needs of the Global South, where per capita income often feels like it’s been trapped in a time warp while fuel prices are on a rocket ride.

Now it’s time to excert BRICS’ influence   in global politics. But let’s not just become another offshoot of the P5 duo of Russia and China. This alliance needs to embrace the aspirations, struggles, and stories of all its members.

The West, with its directives, continues to dominate the IMF and World Bank, the so-called Bretton Woods twins. From the heights of wealth, these rich economies can hardly fathom the realities of BRICS and Global South nations—or even think of offering meaningful advice.

In 2014, BRICS established the New Development Bank to finance infrastructure projects. I’m thrilled to mention that one of its co-founders is an advisor to my organization, COGGS. By the end of 2022, the Bank had disbursed nearly $32 billion to emerging nations for new roads, bridges, railways, and water supply projects. The NDB should have to  function for capacity building and empowering communities in the developing member states.

 

New Development Bank’s annual meeting in Cape Town 2024

BRICS should do more to nurture entrepreneurs and product suppliers; after all, India boasts numerous high-quality yet affordable FMCG brands, many of which even Bollywood stars endorse. Each nation has its ambitions and perhaps a few own agendas for joining BRICS. Take China, for instance—it’s keen to deepen its influence in Africa.

Ahead of 2024 BRICS summit in Kazan, Russian President Vladimir Putin expressed his desire to enhance BRICS’ role in the international financial system,  increase bank cooperation, and multifold  the use of currencies.

Member nations and BRICS supporters should contemplate ways to negotiate duty-free arrangements and slide more items into convenient tariff brackets.

Another pressing issue is currency. India and Bangladesh have found a sweet spot in their currency trading via vostro accounts. At a press meet in February, Bangladesh’s former foreign minister, Dr. Hasan Mahmud in a conversation with this journalist, mentioned plans to multiply currency trading with India. It’s likely happening anytime soon. On the flip side, Moscow has been grappling with a pile of rupees, which has caused headaches for garment manufacturers who’ve had to halt exports to Russia despite demand due to currency complications. BRICS must devise a payment mechanism that enables local traders to conduct transactions smoothly and hassle-free. After all, in the world of international trade, convenience is king.

Andrei Tarkovsky from Russia, Abbas Kiarostami, and my personal favorite, Asghar Farhadi from Iran, have profoundly to the world of arts through their cinematic masterpieces. Their unique storytelling resonates with millions who speak neither English nor any bridge language, reaching hearts across the region and beyond.

While BRICS may not outshine Netflix or Hollywood anytime soon, it boasts a wealth of film festivals and an abundance of talented plot-makers, storytellers, and performers. To truly captivate the screens, canvases, and stages, BRICS must harness this artistic talent and let it shine.

[Ayanangsha Maitra is a Journalist and Research Coordinator of Center of Geoeconomics for the Global South. ]

Why BRICS Needs Ruh – a Soul? Read Post »

How Would New International Reserve Currency Look Like?

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  • Paulo Nogueira Batista Jr.
    – Paulo Nogueira Batista.

    The challenges that the BRICS countries face are now much bigger than they were when the group was formed back in 2008. The international context has become much more hostile and dangerous. Three of the member countries – China, Iran and especially Russia – have very difficult relations with the West, to put it mildly. Although this may be controversial, I believe it can be said that these difficulties have been initiated primarily by the United States and other developed countries that increasingly impose trade barriers, restrictions  and sanctions of different kinds, including in the monetary field.

    From a geopolitical standpoint, the BRICS are a diverse group. Brazil and India, for example, have on the whole good relations with the US, Europe and Japan. India in particular has its own national reasons to maintain some proximity to the US. But Brazil and India realize, of course,  the dangers of a situation in which the previously hegemonic countries, the US and its allies or satellites, resist fiercely their relative decline in economic, demographic and political terms – to the point of having a destabilizing impact on all countries.

    China is the main source of concern, for obvious reasons. It has become the largest economy in the world, measured in PPP terms, and the truth is that the US views China’s rise with suspicion and jealousy.  The situation is reminiscent of the one that existed in the decades before World War I. Germany was on the rise and this led to great preoccupations in Britain, the previously hegemonic power. La perfide Albion, to use Napoleon’s famous expression, articulated a wide-ranging coalition against the upcoming rival that ultimately led to Germany’s  defeat in 1918. China is, I believe, aware of these precedents. And if I know the Chinese well, they have probably studied the German experience quite carefully. In this respect, they seem to follow Bismarck who once said: “I never learn from my own experience, only from that of other people.”

    What role can the BRICS, now with 9 countries, play in a world fraught with unprecedented risks? Should the BRICS continue to expand the number of its members? If so, how? What have we learned from our experience with major economic initiatives such as the New Development Bank (NDB), headquartered in Shanghai, and the BRICS Contingent Reserve Arrangement (CRA), the group’s monetary fund? How should we proceed with discussions concerning matters such as alternative payment systems, the use of our national currencies in external transactions, and the especially the possible creation by us of a new international reserve currency? Can the BRICS act together to provide a viable alternative to the US dollar and the existing international monetary and financial arrangements?

    These are the issues I intend to briefly address.

    BRICS expansion: pros and cons

    Although national perspectives differ and the BRICS are a heterogenous group, we have shown that we can act together. We have created the NDB and the CRA, two financing mechanisms that have significant potential to evolve and contribute to a change in the international financial architecture. These two initiatives have a long way to go and have achieved less than could be expect, but they are there and can be developed fruitfully. The CRA is a small and still unused virtual reserve pooling arrangement, but the NDB has actual physical and practical existence.

    The BRICS formation is now expanding. Four new members have come in as of January 2024 – Egypt, Ethiopia, Iran and United Arab Emirates. Argentina rejected the invitation to join. Saudi Arabia, also invited, is sitting on the fence; it has neither accepted nor rejected the invitation and participates irregularly in the BRICS gatherings. The four new members would need to be incorporated into the NDB and the CRA. Two of the four have already joined the NDB (Egypt and United Arab Emirates); none have yet joined the CRA.

    So now we are 9 countries. And it is reported that a large number of other countries would like to join BRICS. How should we view this? The issue is not simple. Expansion has positive and negative sides to it.

    On this point, as in other BRICS-related matters, it is important to distinguish political and media hype from the actual on the ground realities of BRICS cooperation. A lot of noise has been made about the rapid growth of the group and the challenge it represents to the G7 and the West more generally. It is indeed true that the entry of new members can increase the clout of the group, especially if they are medium or large size countries.

    The downside is that the BRICS may become too large and even more heterogeneous than it already is, undermining its capacity to generate practical results. Do we not run the risk of seeing the BRICS become a talk shop? Something like the G77 – a platform for grand speeches and fine words with little true impact on world affairs?

    Having participated in the negotiations that led to the NDB and the CRA, as well as in the early years of the NDB as one of its founding members, I can tell you that it was extremely difficult to achieve anything with only five countries around the table, especially because of the tradition of taking decisions by consensus, carried over from the BRICS political formation to the actual working of the NDB – and mind you this was something we had not desired and not  foreseen in the bank’s Article of Agreements. Consensus, especially if understood rigidly as unanimity, paralyses decision-making.

    Well, now consider the existence of nine members – and possibly more. Practical results may elude us. We should thus proceed with caution. Any further expansion better be very gradual and orderly. One possibility would be to incorporate new countries as strategic partners, and not right away as full members of the BRICS.

    Monetary initiatives

    This brings me to the main topic I wish to address – the possibility of building alternative arrangements to the US dollar and the Western payment systems, an objective that has been on our minds for some time. Can we work out such arrangements with a larger group of participating countries? With nine members or even more, if further expansion of the BRICS occurs? Let us hope so. But it will undoubtedly be a challenge. And a challenge it would be in any case, even with a smaller number of countries.

    The reasons for designing alternative arrangements are clear and there is no need to repeat at length what I and many others have written in recent years. Two points only. First, the dollar, the euro, and the Western payment system have been dramatically misused as political and economic weapons. Second, the fiscal and financial fragilities of the US economy raise legitimate doubts about the feasibility of continuing to rely on the dollar as the hegemonic international reserve currency.

    So, we must act. Easier said than done, of course. As the Indian proverb goes: “When all is said and done, more is said than done”. Although the Chinese are an exception to this dictum, I add in parenthesis,  since they normally do more than say.

    The challenge for the BRICS is, first of all, political – the US deeply resents any attempt to unseat the dollar and to undermine what De Gaulle called the United States’ “exorbitant privilege” – understood, in short, as the capacity to pay its  bills and debts by simply issuing currency. The US is ready to blacklist any person or country that truly works to create alternatives to the dollar in a practical and effective manner – not talking here about speeches and grand proclamations. And Americans do not hesitate to call into action the allies and clients they have within  most countries in order to undermine any initiatives of such sort. China, Russia and Iran are probably immune to these maneuvers. The same cannot be said of other countries of the BRICS. This is essential to the full understanding of the political economy of BRICS monetary and financial initiatives.

    But the challenge is also technical. Constructing an alternative monetary and payment system requires hard and specialized work, as well as prolonged and difficult negotiations. Are we capable of carrying this out? I believe we are. Have we, however, made sufficient progress since the matter hit the headlines? Some progress was made since this group of government officials, scholars and politicians last met, in Johannesburg, in August 2023. But less than could be expected.

    Under the Russian presidency of the BRICS, in 2024, there have been partly successful attempts to move the discussion forward. For instance, a group of independent experts has been created, of which I am a member, and in which other economists take part, notably the American economist Jeffrey Sachs, to discuss the reform of the international monetary system and the possibility of a BRICS currency. These experts will meet in early October, here in Moscow, to continue the exchange of views and hopefully to come to concrete suggestions. The Executive Directors of the BRICS have also been discussing the matter, under the leadership of the Russian Executive Director in the IMF, Aleksei Mozhin, who also convenes the group of experts. So far, however, not much progress has been made on the issue of monetary reform and the possible creation of a new currency as an alternative to the dollar. Brazil will be the next president of the BRICS in 2025. Let’s hope Brazilians can pick up where the Russians left off.

banknotes, currency, finance

 

Transactions in national currencies and alternative payment systems

More progress seems to have been made during the Russian presidency on related matters, such as transactions in national currencies intra-BRICS and also between BRICS and other countries, as well as in the construction of possible alternatives to the SWIFT payment system, most notably the so-called BRICS Pay or BRICS BRIDGE. I am not sure BRICS Pay is a ready to go initiative, but such work is undoubtedly a most welcome initiative that goes some way into ridding us of the excessive dependence on the Western currencies and payment systems.

Nevertheless, it should be recognized that settlements in national currencies by-passing the US dollar and  alternatives to SWIFT have their limitations in terms of the main objective which is to de-dollarize and foster a multicurrency system for an increasingly multipolar world.

The crux of the matter is that the existence of an alternative reserve currency is ultimately indispensable to make de-dollarization work. The reason lies in the fact that only accidentally will there be an equilibrium in the balance of transactions in national currencies among countries. An alternative international reserve currency is needed to allow countries to register surpluses and deficits over time. In the absence of this, countries would either revert to some sort of barter – or fall back on the US dollar and other traditional currencies, something that would defeat the whole purpose of the exercise.

An example. Russia has a substantial surplus with India. Trade and other transactions are carried out mostly in their national currencies, if I am not mistaken. Therefore, Russia is accumulating large stocks of rupees. Now, it may not want to hold this currency permanently in its reserves, perhaps because the rupee  is not fully convertible and the Russian central bank may harbor doubts about its stability. What are Russia’s options? It can try to dispose these excessive surpluses in rupees by seeking investment opportunities in India or by making an additional effort to buy Indian goods and services. It can also use these rupees in third countries that have an interest in obtaining Indian currency due to close economic proximity to India. These alternatives, however, are clearly second best and hark back to the antiquated barter system in which economic agents traded goods bilaterally and sought third parties to dispose of unwanted goods. It was precisely to avoid this inefficient barter system that money was created in the first place to serve as a means of payment, a common standard of value, and an instrument for holding reserves. For the very same reason, the BRICS need a new reserve currency as an alternative to the US dollar and other traditional reserve currencies.

A new reserve currency – the NRC

How could this new currency look like? There are several possible routes. Allow me to sketch out, in conclusion, the route that looks more promising.

Let’s call the new currency the NRC, the acronym for new reserve currency. A previous great name was the R5 proposed by Russian economists when the BRICS were five countries and all of their currencies began with the letter R. This name was ruined, however, by two circumstances. Some of the four new members have currencies that do not begin with the letter R. Not a big deal, of course. So, could we then call it simply the BRICS or BRICS + currency? Not possible, unfortunately. Some of the BRICS+ countries are reluctant or even opposed to the idea, India most notably. This is a major barrier, but we can work around it, as I will attempt to explain.

The NRC could have the following characteristics. It would not be a single currency, replacing the existing national currencies of the participating countries. It would therefore not be a euro-like currency issued by a common central bank. The NRC would be a parallel currency designed for international transactions. The national currencies and central banks would continue to exist in their current format, as normal currencies and normal monetary authorities.

The NRC would not have a physical existence in the form of paper money, coins, and demand deposits in commercial banks. It would be a digital currency, analogous to the CBDCs (central bank digital currencies) that have been or are being created in a number of countries.

Note in passing that digital format largely replaces the traditional role of banks as intermediaries and creators of means of payment. The CDBCs and the NRC would downplay the role of banks, provided their use is not tied to the possession of an account in a commercial bank.

An issuing bank – let’s call it the NRMA, the New Reserve Monetary Authority – could be established jointly by the participating members. The NRMA would be in charge of creating NRCs and also bonds – call them the NRBs, new reserve bonds –  into which NRCs would be freely convertible. The NRBs would be fully guaranteed by the National Treasuries of the members. This scheme is similar in some respects to the celebrated hyperstabilization of Germany in 1923-1924, achieved by the creation of the Rentenmark as devised by the great but largely forgotten German economist Karl Helfferich.

A first step, that has been advocated for some time by Russian economists, could be the creation of a unit of account for the NRC, an SDR-like basket in which the weight of the national currencies of the participating countries would correspond roughly to their share in the GDP of the group. China’s renminbi would have the highest weight in the basket, say 40%; Brazil, Russia, and India, 10% each, for example; and the remaining 30% could be shared among South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates.

Well, this relatively simple step could have been taken already. Disappointingly, the Russian presidency of the BRICS in 2024 did not manage to take it until now. Let’s see if Brazil manages to do so during its presidency in 2025.

The reason for the slow progress in this area seems to be the lack of consensus. It is reported that India and South Africa, presumably for political reasons, are against the idea. India – and this is only a conjecture – may be hesitant to displease the US on such a crucial matter. Why? Perhaps because it feels it may need US support in case of a deterioration of the traditionally tense relations with China. Brazil, I note in passing, is also not invulnerable to similar difficulties. In Brazilian society and even within the Lula administration, there are many that look up to the US and have ties with American business and official circles.

I hope that these vulnerabilities and the tensions between China and India will be overcome. But, in the meantime, could we not move forward on the basis of a coalition of able and willing countries? The NRC could be created by a sub-set of the BRICS. The others would join later. This is advisable, in my opinion, but runs up against our entrenched tradition of consensus. If we stick to this tradition, however, we may not get anywhere.

The alternative to something like the NRC would be a gradual replacement of the US dollar by the Chinese renminbi, the currency of the rising superpower. This is already

happening to some extent. Can it continue in a major way? Seems doubtful. One thing to remember is that the rising superpower is also an emerging market and middle income country. It has vulnerabilities and concerns not necessarily shared by the US and other high income nations.

What I mean is that in China’s case, the “exorbitant privilege” could become an “exorbitant burden”. Would China be willing to make the renminbi fully convertible? Would it contemplate giving up the capital account restrictions and foreign exchange controls that protect the Chinese economy from the vagaries of international finance? Would it accept renminbi appreciation as a result of the increased demand for it as an international asset? Would this appreciation not harm the Chinese economy`s international competitiveness and dynamism? The trend towards appreciation could be countered by accumulating additional international reserves. But where would these additional reserves be parked? In dollar, euro or yen denominated assets? Back to square one.

Final remarks

Let us therefore brace ourselves and rise to the task of creating a new reserve currency, a potential game changer in global monetary and financial affairs. In parallel, we should  continue with the expansion of transactions in national currencies and with the promising ongoing work on alternatives to Western payment arrangements.

One should keep in mind that the BRICS will be causing disappointment all over the Global South, if they remain in the realm of slogans, speeches and proclamations and show themselves uncapable of groundbreaking  practical initiatives.

References: 

Bao, Gai. “From De-Risking to De-Dollarisation: The BRICS Currency and the Future of the International Financial Order”, Wenhua Zongheng, Volume 2, Issue no. 1, May 2024, Tricontinental: Institute for Social Research.

Klomegah, Kester Kenn. “Prospects for BRICS New Currency and New Payment System”, Modern Diplomacy – All Views/All Voices, August 15, 2024

Lissovolik, Yaroslav. “Boosting the use of national currencies among BRICS”, Russia in Global Affairs, September 14, 2018.

Lissovik, Yaroslav. “A BRICS Reserve Currency: Exploring the Pathways”, BRICS+ Analytics, December 21, 2022.

Galbraith, James Kenneth. “The Dollar System in a Multipolar Word”, The Institute for New Economic Thinking, May 5, 2022.

Galbraith, John Kenneth. Money: When it Came, Where it Went, Princeton University, 2017, first published 1975.

Nogueira Batista Jr., Paulo. “A BRICS currency?”,  Contemporary World Economy Journal, Vol 3, No 1, 2023, School of World Economy, Faculty of World Economy and International Affairs, HSE University. 

Yifan, Ding. “What is Driving the BRICS’ Debate on De-Dollarization”, Wenhua Zongheng, Volume 2, Issue no. 1, May 2024, Tricontinental: Institute for Social Research.

Yonding, Yu. “China’s Foreign Exchange Reserves: Past and Present Security Challenges”, Wenhua Zongheng, Volume 2, Issue no. 1, May 2024, Tricontinental: Institute for Social Research.

 

[The paper was presented at the BRICS Seminar on Governance & Cultural Exchange Forum 2024, in Moscow, Russia, on September 23, 2024. The Seminar was organized by the Publicity Department of the Central Committee of the Communist Party of China (CPC), the Academy of Contemporary China and World Studies and the China International Communications Group with the support of Russian institutions.

Paulo Nogueira Batista Jr. is a Brazilian economist,   former Vice President of the New Development Bank , and former Executive Director for Brazil and other countries in the International Monetary Fund .]

How Would New International Reserve Currency Look Like? Read Post »

COGGS Convenor Proposes Strategic Leadership for BRICS at Moscow Forum

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While speaking at BRICS Seminar on Governance & Cultural Exchange Forum in Moscow on September 23, Mohammed Saqib, Convenor of COGGS offered a pointed evaluation of the BRICS coalition, stressing both its prospects and its current shortcomings. While he recognized the establishment of the New Development Bank as a remarkable achievement, Economist Saqib contended that the organization has fallen short in realizing its goal of making collaborative economic models among its member states: Brazil, Russia, India, China, and South Africa. He underscored the lack of a unified vision in the BRICS that rises above domestic political interests.

Mohammed Saqib, Convenor of COGGS

Private Sector-Global South Engagement & BRICS Business Club

Saqib stressed the importance of engaging private entrepreneurs from the Global South, arguing for the formation of an elite BRICS Business Club. He suggested that such a group could provide critical insights to governments and help forge a path toward accountability and achievable targets.

Furthermore, he advocated for practical measures like currency swaps among BRICS nations to address trade deficits, arguing that this could alleviate dependency on established financial systems like SWIFT.

Saqib concluded with a hopeful perspective, asserting that the Global South is on the verge of a new economic order. He positioned China as a key player that must overcome its cautiousness to catalyze this shift.

He underscored the critical juncture at which BRICS finds itself, as well as the potential consequences of inaction in the face of external pressures, particularly from the United States.

“If we allow swapping of currency, then 86 % of the trade deficit among each other can be sorted out within Global South. We don’t need to go to any either SWIFT or any other system,” Mohammed Saqib remarked.

Each BRICS Member Should Guide Global South

Saqib outlined a vision where each BRICS member nation could take on specific leadership roles in various sectors. For instance, he proposed that India and Russia should spearhead efforts in education and development, showcasing their achievements at the end of the year. Similarly, he argued that Brazil could lead initiatives focused on agriculture and food security, with South Africa playing a pivotal role in environmental protection.

Furthermore, he noted that while India and Russia could jointly host educational initiatives, Russia could also assume a leadership position in energy security for the Global South.

“So similarly, for all the five countries and plus eleven countries, we have worked out a table of what kind we should be the combination of the partners, a main leader, a co-leader, and some kind of performance they will have to show. That is not happening, and BRICS is not performing,” he asserted, while speaking at the seminar in Moscow.

COGGS Convenor Proposes Strategic Leadership for BRICS at Moscow Forum Read Post »

United for Progress: Regional Collaboration in the Global South

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[The Global South shares common challenges related to economic development, social inequality, and geopolitical positioning. Regional cooperation among Global South countries has been recognised as a crucial strategy for addressing these shared challenges and promoting sustainable development. However, cooperation among the countries of the global south faces numerous obstacles.] 

pexels-photo-7634549-7634549.jpg

Over the years, successful regional initiatives have delivered significant gains across economic, political, and sustainable development dimensions. This is why regional cooperation has become an important strategy for countries in the Global South to address common challenges, leverage their collective strengths, and expedite socio-economic development.

This approach has gained momentum in recent years owing to the growing global realisation that global issues are interconnected and cooperative action can generate mutual benefits. Developing countries are increasingly looking towards regional partnerships to address complex challenges and exploit growth opportunities in the context of rapid globalisation, climate change, and economic interdependence.

It is a departure from traditional development models emphasising North-South cooperation and bilateral aid relationships. Instead, it focuses on South-South cooperation through collective action among nations facing similar developmental obstacles. These could range from formal economic integration/trade agreements to shared infrastructure projects, including joint resource management or harmonised policy responses to transnational issues within a region. These initiatives cover agriculture, energy, education, health care, and environmental protection. By combining resources, expertise, and political willpower, countries in the Global South can achieve economies of scale, thus enhancing their bargaining power at the global level and devising more effective ways of dealing with common problems.

In addition to fostering economic growth and social progress, it also enhances stability and security at regional levels due to increased interdependency or shared prosperity among states involved. It further serves as a platform for knowledge exchange whereby countries learn from each other’s experiences and best practices. In some cases, solutions that work in developed economies may not be suitable for developing ones directly.

 

Benefits of Regional Cooperation

The positive outcomes of this form of partnership include improved conditions for trade between regions, which results in enhanced economic stability and political sovereignty, plus better chances for achieving sustainability in terms of ecological balance (OAU/AU), etc.

 

Economic Attractiveness

One key economic advantage of regional cooperation is the possibility of increasing intra-regional trade. According to the United Nations Conference on Trade and Development (UNCTAD), intra-regional exports among developing countries increased from 42% in 2006 to 52% in 2018 (UNCTAD, 2019). This shows that South-South trade is becoming more critical. When ASEAN implemented the ASEAN Free Trade Area (AFTA) in 1992, there has been a remarkable increase in intra-ASEAN trade. Between 1993 and 2020, the ASEAN Secretariat put its total trade at $2.8 trillion, increasing from $123.1 billion in intra-ASEAN trade.

Regional cooperation can also improve the attractiveness of member states’ foreign direct investment (FDI). Larger markets and harmonising regulations attract more FDI into regional blocs. In Latin America, for example, ECLAC notes that “regional integration efforts” have influenced FDI inflows, as the region received $160.7 billion in FDI inflows in 2019 (ECLAC, 2020).

Cooperation can also boost the economy to protect it from external shocks. Regional integration is another important factor in helping African economies cope with global financial crises (AfDB, 2019). For example, African countries with closer regional ties had less severe economic contractions during the 2008 global financial crisis (AfDB, 2019).

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Political Stability and Security

Regional organisations often provide mechanisms for peaceful conflict resolution among member states. One of these frameworks is the African Peace and Security Architecture (APSA) developed by the African Union (AU), which includes conflict prevention, management, and resolution mechanisms. As a result of APSA’s contribution, there has been a reduction in interstate conflicts across Africa, from 16 armed conflicts in 2002 to only seven in 2019 (SIPRI, 2020).

Democratic norms and good governance are often enforced through regional bodies. For instance, the Organization of American States (OAS) has played a crucial role in supporting democratic processes all over Latin America. In developing countries, participation within such organisations increases the chances of democratic transition and consolidation, according to Pevehouse’s study cited by Brooks et al. (2005:727).

The collective security capabilities are enhanced by regional cooperation. Terrorism and drug trafficking have forced several Central Asian countries’ governments into joint military exercises as well as intelligence sharing through the Shanghai Cooperation Organisation (SIPRI). UNODC (2019) has reported that such collaboration led to a 17% increase in drug seizures between the years 2014-18.

 

Sustainable Development

Regional cooperation is required to tackle cross-border environmental issues. The Association of Southeast Asian Nations (ASEAN) has implemented the ASEAN Agreement on Transboundary Haze Pollution against forest fires and haze since its establishment in 2003, leading to a 36% decline in hotspots regionally, according to the ASEAN Secretariat (2020).

Climate change responses could be better managed at the regional level. A good example is the Caribbean Community Climate Change Centre (CCCCC), which has played a significant role in devising climate change strategies for the region. In the Caribbean, coordinated regional action can reduce costs of climate adaptation by up to 25% compared to country approaches, according to the World Bank (2018).

Cooperation makes it possible to manage shared natural resources efficiently. This river basin organisation has coordinated sustainable development and management of the Mekong River Basin, including several Southeast Asian countries, such as Lao PDR, Cambodia, Vietnam, and Thailand. As a result of these efforts, fish stocks increased by 12% and water quality improved by about 15% between 2010 and 20 (MRC, 2021).

Regional power pools and energy cooperation can ensure energy security and promote renewable energy uptake. For instance, the Southern African Power Pool (SAPP), which facilitated electricity trading among southern African countries, increased the region’s renewable energy capacity by 22% from 2015 to 2020 (International Renewable Energy Agency, 2021).

 

Obstacles to Regional Collaboration and Solutions

 

Economic Inequalities

One of the major hurdles in regional cooperation is economic inequalities among member countries that may stall cooperation. Rich countries might be hesitant to share their resources with others or open up their markets because they fear economic losses. For example, within the East African Community (EAC), Kenya’s GDP per capita is almost twice as much as Tanzania’s and four times higher than it is for Burundi’s (World Bank, 2022), which puts trade discussions into tension.

A possible way to subvert this inequality problem in regional cooperation is to implement asymmetric integration strategies that allow less developed countries more time to adapt to regional policies. The ASEAN-minus-X formula, which gives space for some members to temporarily opt out of certain economic initiatives, has been useful in managing disparities (Asian Development Bank, 2019).

 

Political Stability and Conflicts

Political instability or conflicts at the country level can derail regional efforts to promote cooperation. An ongoing conflict in South Sudan, for instance, has impeded the progress of the Intergovernmental Authority on Development (IGAD) in eastern Africa.

Strengthening regional capacities for resolving conflicts and their peacekeeping abilities will mean greater gains. Economic Community of West African States (ECOWAS) successfully intervened in several conflicts, such as The Gambia’s 2017 case, thus showcasing how regional bodies can ensure stability (International Crisis Group, 2019).

 

Weak Organisational Capacity

Numerous organisations in the global south regions lack sufficient institutional frameworks and means to enforce these. South Asian Association for Regional Cooperation (SAARC) has not succeeded due to poor institutions implementing most of its initiatives.

Enhancing institutional capacity requires investment in capacity-building activities targeting regional institutions while creating clear rules that can be implemented and enforced at all times. The African Union’s reform process, which commenced in 2016, seeks to increase the organisation’s effectiveness and efficiency (African Union, 2020).

 

Sovereignty Concerns

Countries might feel challenged to surrender their decision-making powers to regional bodies because of fears about loss of sovereignty. For instance, Mercosur has faced a problem deepening its integration among South American countries due to the member states’ unwillingness to give up their economic policy autonomy.

A practical solution involves adopting a flexible approach to integration that respects national sovereignty while promoting cooperation. The Pacific Alliance has been successfully pragmatic and business-oriented, thus making strides in areas like trade and investment without compromising members’ autonomy (Inter-American Development Bank, 2018).

 

External Influence

Global South regional cooperation must take into account external influences. For example, individual agreements between China and some ASEAN countries sometimes complicate ASEAN’s collective bargaining position. It is important to formulate joint strategies for dealing with outside powers to solve this. The African Continental Free Trade Area (AfCFTA) is a good step towards strengthening Africa’s collective bargaining power in global trade negotiations (United Nations Economic Commission for Africa, 2021).

 

Infrastructure and Connectivity Gaps

Poor physical and digital infrastructure can significantly hinder the actualisation of regional cooperation initiatives. For instance, inadequate transport linkages in Central Asia have significantly limited the potential for intra-regional trade within the Central Asia Regional Economic Cooperation (CAREC) Program. Regional infrastructure projects must be prioritised while multilateral development banks’ funding capacities are tapped. To bridge the continent’s infrastructure gap, the African Development Bank supported the Programme for Infrastructure Development in Africa (PIDA) (African Development Bank, 2020).

 

Public Support Inadequacy

Limited public awareness and support for regional integration sometimes impede the political will to collaborate. For example, the low voter turnout in East African Legislative Assembly elections shows little public engagement with EAC. To address this, it is crucial to increase the level of education and public outreach about the benefits of regional cooperation. This program has helped create a regional identity through student exchanges that could be replicated in other regions (European Commission, 2019).

These challenges underscore how complicated regional cooperation can be in the Global South; however, potential solutions show that these hurdles can be crossed given political willingness, innovative approaches, and sustained efforts. Successful regional cooperation must be multidimensional since it covers economic, political, and social aspects while still being flexible enough to accommodate the specificities of different regions.

Conclusion

In conclusion, regional cooperation in the Global South has proven to be a powerful catalyst for development, fostering economic growth, political stability, and sustainable progress. The benefits of this collaborative approach are manifold, including increased intra-regional trade, improved foreign direct investment attractiveness, enhanced conflict resolution mechanisms, and more efficient management of shared natural resources. However, various obstacles persist, such as economic inequalities, political instability, weak institutional capacity, sovereignty concerns, external influence, infrastructure gaps, and insufficient public support.

Several recommendations can be made to overcome these challenges and fully harness the potential of regional cooperation. Firstly, implementing asymmetric integration strategies can help mitigate economic disparities among member countries. Secondly, strengthening regional conflict resolution and peacekeeping capacities is essential for maintaining political stability. Thirdly, investing in the institutional capacity of regional organisations can improve their effectiveness and efficiency. Fourthly, adopting a flexible approach to integration that respects national sovereignty can alleviate concerns about the loss of decision-making power.

Moreover, formulating joint strategies for dealing with external powers can help safeguard the interests of regional blocs. Prioritising regional infrastructure projects and tapping into multilateral development banks’ funding capacities can help bridge infrastructure gaps. Lastly, increasing public education and outreach about the benefits of regional cooperation can foster greater public support for and engagement with these initiatives.

Regional cooperation does not answer all development challenges. However, in an increasingly interconnected world, regional cooperation is a vital strategy for countries in the Global South to address common challenges and leverage their collective strengths. More effectively pursuing their development objectives and finding their positions within the global economy would necessitate pooling resources, harmonising policies, and presenting united fronts by those nations. Therefore, the leaders in the global south should build upon existing achievements, learn from past mistakes, and deepen their commitment to regional integration for the good of their people and others globally.

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