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In January 2024, BRICS, the influential bloc of emerging economies, expanded its membership by welcoming four new countries-Egypt, Ethiopia, Iran, and the United Arab Emirates (UAE)-with Saudi Arabia also in the process of joining. The inclusion of Egypt and Ethiopia into the group marks a critical moment for Africa, as these two regional powerhouses are now poised to significantly shape not only the continent’s economic and political future but also their roles in global geopolitics. This expansion reflects the evolving dynamics of the BRICS group, as it increasingly focuses on fostering cooperation among developing nations and providing an alternative to Western-dominated financial and political institutions.
The inclusion of Egypt and Ethiopia in BRICS is particularly noteworthy as it brings new opportunities for economic growth and collaboration, as well as a number of challenges. These two African nations are both strategically important in their regions, and their membership could serve as a gateway for the continent’s broader engagement with BRICS. However, their strained relationship, especially over the Grand Ethiopian Renaissance Dam (GERD) issue, highlights some of the internal conflicts that could potentially impact the cohesion of the expanded group.
The BRICS bloc, initially formed in 2009 by Brazil, Russia, India, and China, with South Africa joining in 2010, was established to advocate for the interests of emerging economies and to challenge the dominance of Western-led institutions like the International Monetary Fund (IMF) and the World Bank. Since its formation, BRICS has sought to promote alternative economic instruments for its members, such as the creation of the New Development Bank (NDB), which aims to provide financial resources for infrastructure and sustainable development projects.
The recent expansion, often referred to as BRICS+, represents 46 percent of the world’s population and covers over 25 percent of the planet’s land area. With a combined global trade share of 28 percent and attracting 25 percent of foreign direct investment (FDI), the expanded group is becoming a formidable economic bloc. In terms of global GDP based on purchasing power parity (PPP), BRICS+ now rivals the G7, whose economic influence has been steadily declining. By 2029, BRICS+ is expected to control 38.3 percent of global GDP, while the G7’s share is projected to fall to 27.5 percent.
For Africa, the inclusion of Egypt and Ethiopia amplifies the continent’s influence within this expanding bloc and provides new avenues for engagement with some of the world’s most significant emerging economies.
Both Egypt and Ethiopia stand to benefit from their membership in BRICS. Egypt, which has been grappling with an economic crisis marked by soaring inflation-reaching 40 percent in early 2024-and a rapidly devaluing currency, is eager to diversify its economic partnerships. For decades, Egypt has relied heavily on US aid and Western financial support. However, as part of BRICS, Egypt now has the potential to engage in trade denominated in non-US dollar currencies, which could ease some of the financial pressures caused by reliance on the dollar.
Egypt’s economy is already seeing benefits from increased trade with BRICS members. Russia, for instance, has solidified its position as Egypt’s top wheat supplier, with nearly two-thirds of Egypt’s wheat imports coming from Russia. Moreover, Egypt’s growing plastics industry, which exports a wide range of products, could benefit from access to broader BRICS+ markets. Egypt is also looking to expand its industrial capacity, with an ambitious goal of reaching $100 billion in annual exports. Trade with other BRICS nations, including India and China, could play a critical role in realizing this target.
For Ethiopia, BRICS membership offers a unique opportunity to address some of its pressing economic challenges. Ethiopia, one of the fastest-growing economies in Africa with annual growth exceeding 5 percent, is looking to expand trade and investment with BRICS nations, particularly China and India. Both countries are already major trading partners, and membership in BRICS could deepen these economic ties. However, Ethiopia faces significant hurdles, including high inflation, a lack of foreign currency reserves, and the lingering effects of the conflict in the Tigray region.
While both Egypt and Ethiopia stand to benefit from BRICS membership, their longstanding dispute over the Grand Ethiopian Renaissance Dam (GERD) could complicate their cooperation within the bloc. The GERD, located on the Blue Nile in Ethiopia, has been a source of tension between the two countries for years. Egypt fears that the dam, which is nearing completion, will reduce its water supply, as it relies on the Nile for 90 percent of its freshwater. Ethiopia, on the other hand, views the dam as essential for its energy production and economic development.
The roots of this dispute can be traced back to colonial-era agreements that gave Egypt and Sudan control over the Nile’s waters, while Ethiopia was excluded from these arrangements. Ethiopia has refused to recognize these treaties, arguing that they were imposed by colonial powers and do not reflect modern-day realities. Despite several rounds of negotiations, a final agreement on how to manage the dam’s impact on downstream countries remains elusive.
This unresolved conflict has the potential to create friction within BRICS, as two key African members have conflicting interests over a vital resource. If not managed carefully, the GERD dispute could undermine the unity of the bloc and complicate efforts to present a unified front on global issues.
Beyond the bilateral challenges between Egypt and Ethiopia, the inclusion of these two nations in BRICS opens up new opportunities for the broader African continent. Both Egypt and Ethiopia could serve as gateways for BRICS nations looking to access African markets. Egypt, a key player in the African Continental Free Trade Area (AfCFTA), provides BRICS with direct access to one of the world’s largest free trade areas, encompassing 1.3 billion people and a combined GDP of over $3 trillion.
BRICS could also serve as a counterbalance to Western-dominated financial institutions like the IMF and World Bank, offering African nations more flexible financial arrangements. This is particularly relevant for Ethiopia, which has struggled with high levels of foreign debt. With BRICS providing alternative sources of funding, African countries may have greater leverage in negotiating the terms of development projects, potentially reducing their dependency on Western lenders.
The expansion of BRICS to include Egypt and Ethiopia marks a new chapter in Africa’s engagement with the global economy. For both countries, membership in the bloc presents opportunities for economic diversification, increased trade, and a stronger voice on the international stage. However, internal challenges-most notably the GERD dispute-must be carefully managed to prevent regional tensions from affecting broader BRICS cooperation.
As BRICS continues to grow in influence, its ability to offer alternative economic models and financial resources will be critical for the Global South, particularly Africa. The inclusion of two key African nations in the bloc not only strengthens BRICS but also provides Africa with a platform to shape the future of the global economic order.
Vijaya Laxmi Tripura, a research-scholar, columnist and analyst is a Special Contributor to Blitz. She lives in Cape Town, South Africa.
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