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The Safe Bet May Be Greece Joining the BRICS

Demands for more austerity for Greeks at the G7 may have just pushed Athens to join the Eurasian Economic Union (EEU) and Shanghai Cooperation Organization (SCO) 

This post first appeared on Russia Insider

Western sanctions over the ongoing Ukraine conflict have taken a massive toll on countries like Greece. Meanwhile, Russia has dramatically accelerated and expanded multilateral projects – most notably the Eurasian Economic Union (EEU) and Shanghai Cooperation Organization (SCO) – aimed at counterbalancing Western military and economic institutions. Now Russia has taken steps to integrate Greece into the $100 billion New Development Bank as early as the middle of this month. Already the western mainstream has begun to attack the Greek leadership.

This initiative, which has been talked about for months now, is one of Russian President Vladimir Putin’s strategic moves to help erode Western unity while strengthening non-European partnerships across Asia, and beyond. Greece now appears ready to enter the fast growing financial sphere of the BRICS, and to leave behind the near catastrophic associations with banking the World Bank and International Monetary Fund (IMF). One may gather the import of this move via examining the headlines from the mainstream in the West this morning. BBC’s headline is damning; “Greece's Tsipras 'failed' to deliver promised plan – Juncker”, while Bloomberg has it; “G-7 Unites to Push Greece on Resolving Creditor Standoff”.

<figcaption>Greece's Alexis Tsipras</figcaption>
Greece's Alexis Tsipras



This weekend at the economic summit in Munich protesters came into conflict with police as organization such as the We Are Change orgnaization (see tweet above) organized large demonstrations. By all accounts US President Barack Obama's mission in Munich was to somehow cement the western alliance's coalition against Russia. Some experts wonder at how tightening the screws applied to Greece may help accomplish this though. The most recent statement from Greece's Prime Minister on Saturday betrays how most Greeks feel about deepening austerity cuts. 

"I could not imagine that the politicians–if not the technocrats–would believe that after five years of devastating austerity under the Memorandum, there would be a single Greek MP that would vote in favor of repealing the EKAS (Pensioners’ Social Solidarity Benefit) for low income pensioners and for increasing VAT by 10% on electricity."

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President Barack Obama and German Chancellor Angela Merkel in Munich - Bundesregierung/Kugler

This past year and a half differences of opinion by key EU states over the Russia-Crimea situation have become a solid wedge, one that Mr. Putin would be foolish not to exploit. During a two-day meeting in April in Moscow, Greek Prime Minister Alexis Tsipras solidified the bridge in between Athens and Moscow, which has in turn led to a lifting of an import ban on some Greek products. Added to this, the news Russia is ready to include Greece in the new Turkey Stream pipeline project also bolstered Athens’ options.

In May, Russia surprised the world by extending an invitation to Greece to join the BRICS Development Bank. Beginning tomorrow and running through June 10th, Russia will host the 7th annual BRICS summit alongside the next SCO summit in the Russian city of Ufa, which offers another opportunity for the BRICS to seek collaboration on . energy deals, shared military and defense collaborations, and what some say is a shared vision of a new Russia-China partnership. Obviously, the entry of Greece into the $100 billion New Development Bank will be a sort of spear in the side of the once dominant Western financial conglomerate. The final decision on integrating a sixth member will likely be discussed during the St. Petersburg Economic Forum on June 19-20.

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German Chancellor Angela Merkel, her husband Joachim Sauer (left) and US President Barack Obama eating a traditional Bavarian breakfast in Krün - Bundesregierung/Kugler

With Greece’s creditors demanding deep reforms to pensions and the public sector in the country, it is doubtful Athens has any choice really except to side with Russia and China. Facing public criticism or worse, the Greek leadership cannot punish citizens further. Tsipras is facing a tough call on whether to accept the Russian invitation to join the BRICS bank, but fear of another financial disaster for Greece, and a loss of the people’s support, may tell the tale for the Greek leader. On the European side of this chessboard, the growth of a new BRICS economic cooperation may attract other EU states such as Bulgaria, Hungary, and eventually the rest of the Balkans. The end result would be a dramatic erosion of the western economic alliance and NATO. 

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