Saudi Arabia’s Entry into BRICS: What Does It Mean for the Global South?

Saudi Arabia’s inclusion in BRICS (Brazil, Russia, India, China, and South Africa) marked a significant shift in the global geopolitical landscape.

As one of the world’s leading oil producers and a powerhouse in the Middle East, Saudi Arabia’s entry into this group of emerging economies signals a deliberate pivot towards strengthening its role in global governance, economic influence, and South-South cooperation.

While much has been said about BRICS challenging the dominance of Western-led institutions, Saudi Arabia’s entry could reshape alliances and bring new opportunities, especially for the Global South.

This article explores the implications of this move for Saudi foreign policy, global economics, and alliances in the Global South.

A Strategic Recalibration of Saudi Foreign Policy

Saudi Arabia’s foreign policy has undergone a major transformation over the past decade, driven by the ambitious Vision 2030 strategy led by Crown Prince Mohammed bin Salman. The country’s focus has expanded from its traditional reliance on the United States and the West to seeking greater autonomy and diversification in its international partnerships. BRICS membership is a clear extension of this recalibration, reflecting Saudi Arabia’s desire to assert its influence in global affairs beyond the Western-centric order.

For Saudi Arabia, joining BRICS offers more than just a seat at a high-level geopolitical table; it is a strategic move to balance its alliances. The country seeks to maintain strong ties with the US and Europe while deepening relationships with the Global South, particularly in Africa and Asia. This pivot is driven by the recognition that the world is shifting towards a multipolar order where emerging economies play an increasingly vital role in shaping global governance.

BRICS, which represents over 40% of the world’s population and around 25% of global GDP, offers Saudi Arabia an alternative platform to influence international affairs. Its inclusion demonstrates Riyadh’s strategic adaptability and underscores its willingness to engage with non-Western powers like China and Russia, despite their growing tensions with the US. This marks a clear break from the past, where Saudi Arabia’s foreign policy was heavily tethered to Western interests, particularly through oil diplomacy.

Economic Implications: Oil, Investment, and Trade

Economically, Saudi Arabia’s entry into BRICS could be a game changer for both the Kingdom and the Global South. As the largest oil exporter in the world, Saudi Arabia brings a critical energy dimension to the BRICS bloc. This could potentially give BRICS members greater leverage over global energy markets, especially at a time when there are increasing calls to transition away from dollar-based oil transactions. Saudi Arabia’s membership strengthens BRICS’ ability to diversify away from the US dollar, particularly in energy trading, which has been a key objective for the group.

With growing interest among BRICS members to reduce reliance on the dollar in international trade, Riyadh’s involvement could accelerate initiatives aimed at using local currencies for trade settlements, particularly in oil transactions. This could lead to the creation of new financial instruments and frameworks, allowing BRICS to carve out a larger share of global commerce while reducing their vulnerability to Western economic sanctions.

From an investment perspective, Saudi Arabia’s deep pockets, buoyed by oil revenues, can facilitate larger BRICS projects, particularly in infrastructure development, renewable energy, and digital transformation across the Global South. Saudi investment is likely to flow into BRICS’ flagship projects, such as China’s Belt and Road Initiative (BRI), expanding Riyadh’s influence in Asia and Africa, regions where BRICS members are already deeply entrenched.

For the Global South, Saudi Arabia’s inclusion could provide much-needed financial backing for development projects, particularly in energy and infrastructure. Riyadh’s involvement in initiatives like the BRICS Development Bank, also known as the New Development Bank (NDB), could help fund projects that prioritize sustainable development and connectivity within the Global South. This is particularly significant for African nations, many of which are in dire need of foreign direct investment to spur economic growth and modernize infrastructure.

Shifting Alliances and the Global South

Saudi Arabia’s BRICS membership could also shift geopolitical alliances across the Global South. Historically, the Kingdom has been a key player in the Middle East, particularly through its leadership in OPEC. However, BRICS membership broadens Riyadh’s reach into other regions of the Global South, particularly Africa and Latin America. This development has the potential to alter regional dynamics by positioning Saudi Arabia as a bridge between the Middle East and other emerging economies.

For Africa, in particular, Saudi Arabia’s inclusion in BRICS could signal a new era of cooperation. African nations, which have often been caught between competing Western and Chinese interests, could benefit from increased Saudi investment, particularly in sectors like energy, infrastructure, and agriculture. With Riyadh positioning itself as a key investor in African development, African countries may find new opportunities for trade and investment, reducing their reliance on Western aid and Chinese loans.

Moreover, Saudi Arabia’s influence within BRICS could serve to elevate the concerns of the Middle East and Africa on the global stage. Issues such as food security, climate change, and sustainable development, which are of critical importance to many Global South nations, may receive more attention within the BRICS agenda with Riyadh’s backing.

Redefining Global Governance

Beyond economic cooperation, Saudi Arabia’s entry into BRICS could contribute to reshaping global governance. BRICS has long advocated for reforms of international institutions such as the International Monetary Fund (IMF) and the World Bank, arguing that these bodies are outdated and continue to disproportionately favor Western nations. Saudi Arabia’s entry could bolster BRICS’ calls for a more representative and equitable global governance system, particularly for countries in the Global South.

Riyadh could also play a pivotal role in BRICS efforts to reform the United Nations, particularly in expanding the Security Council to include more representation from emerging economies. Saudi Arabia’s diplomatic influence and financial power could help rally support for such reforms, particularly from the Middle East and Africa, which have long been underrepresented in global decision-making bodies.

Saudi Arabia’s involvement in these efforts reflects its broader goal of positioning itself as a leader of the Global South. By aligning with BRICS’ vision of a multipolar world, Riyadh is not only seeking to diversify its partnerships but is also positioning itself as a champion of the interests of developing nations.

Challenges and Opportunities Ahead

Despite the potential benefits, Saudi Arabia’s BRICS membership is not without challenges. One of the primary difficulties Riyadh will face is balancing its relationships with both BRICS members and traditional Western allies, particularly the United States. Saudi Arabia’s economic and military ties to the US remain strong, and Riyadh will need to carefully navigate its new role within BRICS to avoid alienating Washington.

Furthermore, Saudi Arabia’s inclusion in BRICS may place pressure on the Kingdom to meet the bloc’s expectations regarding sustainable development and economic reforms. While Riyadh has made significant strides in diversifying its economy, it remains heavily reliant on oil revenues. This reliance could present challenges as BRICS pushes for more investment in renewable energy and other green technologies.

However, these challenges also present opportunities for Saudi Arabia to further modernize its economy and enhance its leadership role within the Global South. By leveraging its membership in BRICS, Riyadh can accelerate its Vision 2030 goals, particularly in terms of diversifying its economy, investing in new technologies, and fostering international partnerships.

Saudi Arabia’s New Role in a Multipolar World

Saudi Arabia’s entry into BRICS marks a significant moment in the Kingdom’s foreign policy and its growing influence in global governance. As the world shifts towards a more multipolar order, Saudi Arabia is positioning itself as a key player in the Global South, championing the interests of developing nations while diversifying its international partnerships.

For the Global South, Saudi Arabia’s inclusion in BRICS offers new opportunities for economic cooperation, investment, and development. Riyadh’s financial power, coupled with its leadership role in the energy sector, could help to reshape the global economy, particularly for emerging economies seeking alternatives to Western-led institutions.

As Saudi Arabia navigates its new role within BRICS, it will face challenges in balancing its relationships with traditional Western allies while fulfilling the expectations of the BRICS bloc. However, by embracing this opportunity, Riyadh has the potential to redefine its role on the global stage, strengthening its influence not only in the Middle East but across the Global South.

* A version of this article appears in print in the 1 December, 2024 edition of Leaders-Mena Magazine