Joining the BRICS group — headlined by Brazil, Russia, India, China and South Africa — offers Malaysia several strategic advantages, including a platform for enhanced diplomatic engagement and cooperation with major global players.
In 2022, Malaysia's trade with BRICS countries amounted to approximately US$95 billion. China is our largest trading partner, accounting for around US$77 billion of this total.
Joining BRICS could enhance trade relationships by reducing tariffs and other trade barriers. Furthermore, it could stimulate investment inflows into Malaysia.
In 2021, BRICS countries invested over US$1.5 trillion (RM6.75 trillion) in foreign direct investment (FDI) globally. Malaysia could attract a significant portion of this investment. China and India, with their vast financial resources and technological prowess, could play a crucial role in bolstering Malaysia's industrial and technological capabilities.
Joint ventures and partnerships in sectors such as manufacturing, technology and renewable energy could spur innovation and create high-value jobs, enhancing Malaysia's competitive edge in the global market.
We must also navigate several challenges in the quest to join BRICS, where the geopolitical dynamics within the bloc require careful diplomacy through balancing existing alliances and foreign policy priorities while engaging with members to ensure harmonious integration.
Economic disparities within BRICS also pose a challenge. Malaysia's per capita gross domestic product at approximately US$11,400 is higher than India (US$2,100) and South Africa (US$5,000), but lower than China (US$12,500). Therefore, aligning our economic policies with the bloc's broader objectives necessitates strategic planning and adaptation.
Malaysia must also address certain domestic issues, such as income inequality, labour market dynamics and infrastructure development, to fully leverage the opportunities presented by BRICS membership.
To successfully join the group, Malaysia should also strengthen its diplomatic engagements with current BRICS members, building mutual trust and understanding, paving the way for a seamless integration.
Next, focus on enhancing economic competitiveness. This involves investing in critical infrastructure, fostering innovation and technological advancement, and promoting a conducive business environment to attract foreign investment.
Strategic sectors such as green energy, digital technology and high-value manufacturing should be prioritised to align with the BRICS economic agenda. Malaysia should also leverage its unique geographical and economic position to serve as a bridge between BRICS and Asean. This is especially fortuitous as Malaysia is about to assume the Asean chairmanship next year.
By facilitating trade and investment linkages between these regions, Malaysia can enhance its strategic importance within BRICS while promoting regional economic integration.
Malaysia's proposed membership in BRICS represents a significant opportunity to enhance its global economic and strategic standing. Despite the challenges, the potential benefits in terms of economic growth, diplomatic influence and development financing are substantial.
DR ASHUROV SHAROFIDDIN
Associate professor, Institute of Islamic Banking and Finance,
International Islamic University Malaysia
DR MOHD ZAIDI MD ZABRI
Senior lecturer, Department of
Finance, Faculty of Business and Economics, Universiti Malaya
The views expressed in this article are the author's own and do not necessarily reflect those of the New Straits Times