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Nigeria Joins BRICS as a Partner State Amid Economic Challenges

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Nigeria, once Africa’s largest economy by GDP, has taken a significant step toward strengthening its global economic ties by joining BRICS (Brazil, Russia, India, China, and South Africa) as a partner state. The move was confirmed by Nigeria’s Ministry of Foreign Affairs in a statement released on Saturday, underscoring the country’s commitment to fostering international collaboration and strategic partnerships.

The Significance of Nigeria’s BRICS Membership

The BRICS alliance, which recently expanded to include countries like Egypt, Ethiopia, Indonesia, and the UAE, is emerging as a major global economic force. Partner states, including Malaysia and Thailand, support BRICS’ goal of creating an economic counterweight to the G7 nations and challenging the dominance of the US dollar in global trade, particularly in oil and gas transactions.

For Nigeria, this partnership represents:

  • Enhanced Trade and Investment: A platform to deepen economic ties with the BRICS bloc, particularly with powerhouse economies like China and India.
  • Development Objectives: Access to resources and collaborations aligned with Nigeria’s growth goals.
  • Currency Agreements: Following the 15 billion yuan currency-swap deal with China, Nigeria can leverage BRICS to strengthen its trade in local currencies, reducing reliance on the dollar.

Economic Context: Nigeria vs. South Africa

Nigeria has faced significant economic challenges, including:

  • High Inflation: Soaring prices have strained households and businesses.
  • Tax Collection Issues: At one of the lowest global tax-to-GDP ratios, Nigeria’s fiscal capacity is limited, affecting infrastructure and essential services investment.
  • Declining Economic Rank: Once Africa’s largest economy in 2016, Nigeria now ranks sixth behind South Africa, Egypt, Algeria, Ethiopia, and Morocco based on 2024 estimates.

In contrast, South Africa, as the only African BRICS member, retains the largest economy in Africa and plays a pivotal role in shaping the bloc’s policies.

BRICS’ Strategic Expansion

BRICS’ expansion underscores its intent to reshape the global economic landscape. By adding partner states like Nigeria, the bloc aims to:

  • Increase Clout in Global Trade: Challenge the US dollar’s dominance.
  • Expand Influence in Africa: Leverage partnerships with resource-rich and populous nations.
  • Diversify Membership: Include countries with varying economic profiles and strategic value.

As a BRICS partner, Nigeria stands to benefit from increased trade opportunities, investment inflows, and collaboration on infrastructure projects. However, success will depend on Nigeria’s ability to address its domestic economic challenges, including inflation, tax reform, and public financial management.

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