The allure of joining the BRICS economic bloc has captured the attention of several Southeast Asian nations, such as Malaysia, Thailand, the Philippines and Vietnam. But beyond the headline-grabbing potential of increased trade and investment, crucial questions arise regarding the bloc’s capacity to deliver tangible economic advantages.

In other words, will BRICS membership truly catalyze sustainable growth and development, or will the associated costs and challenges outweigh the rewards?

The tapestry of global trade is intricately woven with threads of geography and economics. These elements coalesce to shape the formation and success of trade agreements.

Geographical proximity is a fundamental determinant of trade patterns. Countries sharing borders or situated in close proximity often enjoy lower transportation costs and reduced trade barriers. The North American Free Trade Agreement, the African Union and the Association of Southeast Asian Nations, for instance, facilitated seamless trade among regional neighbors with shared proximity. Furthermore, shared economic interlinkages could create stronger and more sustainable trade relations, as seen in the cooperation between oil-rich nations in the Middle East.

However, BRICS nations do not share such commonalities. They are geographically and economically dispersed. These factors hinder efficient trade and cooperation. BRICS members possess diverse economic structures with varying levels of development, industrialization and trade specialization. Brazil is a major agricultural exporter, while Russia is a significant oil and gas producer. India has a huge agricultural sector and a rapidly growing IT and service-based economy, whereas China is a manufacturing powerhouse. South Africa, meanwhile, has a diverse economy with a strong mining sector. This economic heterogeneity makes it challenging to identify shared economic interests and implement cooperative policies.

Consequently, joining BRICS may not be economically advantageous for all Asian countries. For instance, Malaysia’s semiconductor-heavy sector aligns well with China’s economic dynamism but has relatively little supply chain connectivity with Brazil or South Africa. Thailand’s tourism sector has limited interlinkages with BRICS countries, and its manufacturing sector already boasts strong ties with China. Vietnam, a rapidly growing manufacturing hub, primarily exports to the U.S. and European Union, with China as a major supplier of inputs. The new addition of BRICS+ members, including Saudi Arabia, Iran and the United Arab Emirates, are also mining-heavy countries with relatively little interconnectivity with the Southeast Asian states.

Despite collectively representing nearly half of the global GDP, intra-BRICS trade (other than with China) remains notably low.

For instance, Brazil traded more with the U.S. ($37.1 billion) and Argentina ($16.7 billion) than any members of BRICS in 2023. Similarly, South Africa’s main trading partners other than China are the U.S. ($8.4 billion) and Germany ($7.8 billion). Besides that, the most significant investors in BRICS nations are not fellow members but established developed economies.

From April 2000 to March 2024, Mauritius and Singapore were the primary sources of foreign direct investment (FDI) into India, contributing a combined 49% of the total inflow. The U.S., the Netherlands, and Japan were also significant investors, contributing 10%, 7% and 6% respectively. For South Africa, the top FDI inflows came from the Netherlands and the U.K. China plays a relatively small role in BRICS FDI, and other than China, intra-BRICS FDI is nearly nonexistent.

While Southeast Asian countries have already established regional trade agreements with major partners like China and India, such as the Regional Comprehensive Economic Partnership (RECEP) and ASEAN+1, being in BRICS does not provide additional economic gain.

Joining BRICS could also constrain a country’s diplomatic flexibility. Close alignment with China and Russia, the bloc’s dominant members, might strain relations with other key trading partners like the U.S. and the EU. These Western powers increasingly view BRICS as a geopolitical rival, potentially leading to trade tensions and economic sanctions. Moreover, excessive reliance on BRICS could deter investment from these major economies, which remain crucial sources of capital and technology. To ensure long-term economic prosperity and geopolitical security, countries must carefully balance their relationships within BRICS with those outside the bloc.

For these reasons, while Malaysia and Thailand have expressed interest in BRICS membership, Indonesia has definitively rejected it in favor of membership in the Group of 20. By participating in the G20, Indonesia has gained access to a wider range of trade and investment partners, enhancing its economic influence on the world stage. In contrast, BRICS’s more limited membership and focus on geopolitical competition may offer fewer tangible economic benefits for Indonesia.

This decision highlights the importance of considering a country’s unique economic strengths and geopolitical position when choosing multilateral affiliations. Rather than aligning exclusively with a specific bloc, Asian countries should prioritize platforms that offer maximum opportunities for economic growth, trade diversification and geopolitical influence.

As the global geopolitical landscape becomes increasingly polarized, Asian countries need to maintain a stance of economic neutrality. They should avoid direct involvement with great powers and exercise particular caution regarding economic blocs that have strong geopolitical implications.

Given these factors, Asian countries may find greater economic benefits from existing regional economic integrations or bilateral trade agreements. Platforms such as RCEP, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), ASEAN+ and APEC, as well as strategic bilateral trade agreements, offer a more balanced approach to economic cooperation, promoting nonpartisanship and economic neutrality. These frameworks often focus on market access, trade facilitation and investment promotion without the inherent geopolitical undertones of blocs like BRICS.