Why Indonesia Joining BRICS Could Impact the Global Economy
According to AntaraNews, Sergey Tolchenov, the Russian Ambassador to Indonesia, has expressed strong support for Indonesia’s bid to join BRICS, labeling it a significant step for the country.
He emphasized that there has been no lobbying or influence from Russia regarding Indonesia’s desire to join BRICS. Instead, Tolchenov pointed out that the approval of Indonesia’s membership must involve a consensus from all existing BRICS member nations.
“This must be a collective decision from all members. It requires the consensus of all members,” Tolchenov stated during a press conference at his residence in Kuningan, South Jakarta, on October 28, 2024.
BRICS, originally formed by Brazil, Russia, India, and China in 2006, later expanded to include South Africa in 2010. Since then, the group has welcomed additional members such as the UAE, Iran, Egypt, and Ethiopia.
Enhancing Bilateral Relations
The ambassador expressed optimism that Indonesia’s inclusion in BRICS would strengthen bilateral relations between Indonesia and Russia. He highlighted that BRICS membership could serve as a platform for discussing various issues, both bilaterally and multilaterally.
“I believe that the most important matters can be addressed bilaterally. However, BRICS will provide an additional avenue for discussing multilateral issues related to politics, economics, cultural exchanges, and socio-economic matters,” he noted.
Tolchenov mentioned that during the recent BRICS summit in Kazan, numerous topics were addressed, culminating in the Kazan Declaration. This declaration includes guidelines on establishing payment mechanisms and financial settlements among BRICS member countries, emphasizing the economic collaboration that BRICS aims to promote.
Weighing the Pros and Cons of Indonesia Joining BRICS
Still quoting AntaraNews, Professor Hikmahanto Juwana from Universitas Indonesia (UI) highlighted the benefits and risks of Indonesia’s potential BRICS membership.
Recently, Indonesia officially submitted a request to join BRICS Plus through a letter to Russian Foreign Minister Sergey Lavrov. According to Indonesia’s Foreign Minister Sugiono, joining BRICS aligns with Indonesia’s national development goals.
- Economic Growth and Strategic Alliances
Hikmahanto emphasized that Indonesia’s potential membership in BRICS could help reduce the influence of OECD (Organization for Economic Cooperation and Development) nations, including the U.S., UK, Germany, and Japan, over the Indonesian economy. As BRICS represents large markets with substantial economic power, Indonesia may see the alliance as a balance to the OECD’s economic dominance.
For Indonesia, a major importer of refined oil products, BRICS membership could open up oil import options with fewer restrictions. Given the U.S. embargo on Russian oil, BRICS membership could provide Indonesia access to discounted oil from Russia.
In addition to economic benefits, joining BRICS may allow Indonesia to gradually lessen its dependence on the U.S. dollar, as BRICS has been working toward using alternative currencies. Arianto Muditomo, a banking analyst and payment systems expert, noted that while challenging, Indonesia’s participation in BRICS could be a step toward a more diversified currency system.
- Potential Risks of Indonesia Joining BRICS
Joining BRICS may create assumptions of Indonesia aligning with China and Russia, the bloc’s primary initiators, which could impact Indonesia’s relations with Western countries like the U.S. and EU nations. However, Professor Hikmahanto argued that Indonesia could still maintain a balanced relationship, managing economic partnerships with BRICS while keeping security alliances with Western nations.
LPS Commissioner Chairman Purbaya Yudhi Sadewa urged Indonesia to carefully evaluate the potential impacts of BRICS membership, considering both positive and negative outcomes. He emphasized the importance of a balanced, non-aligned stance for Indonesia, reminiscent of the Non-Aligned Movement, ensuring positive and sustainable impacts on Indonesia’s economy and global position.
A Balanced Approach to BRICS Membership
Indonesia’s prospective membership in BRICS offers significant economic opportunities and diplomatic challenges. By carefully balancing its interests, Indonesia can potentially strengthen its economy and international relations, leveraging BRICS as a strategic alliance without compromising its established partnerships with Western nations.
