Does more than ambition cement the BRICs?

SINGAPORE (Reuters) - If shared interests are the basis of a successful long-term relationship, the alliance of the four BRIC nations is likely to be a brief affair.

As they meet in Yekaterinburg for a summit next week, Brazil, Russia, India and China -- known as the "BRIC" economies ever since a seminal 2001 Goldman Sachs research paper -- appear to have little in common aside from their size.

They span the political spectrum from thriving democracies to a one-party state. China and India are resource-hungry industrial and service economies; Russia and Brazil are commodity exporters.

The one thing that unites them is ambition.

All four believe their size, economic growth prospects and geopolitical importance entitle them to a greater say in global governance. And they recognize that it is in their interests to press for change together, as a bloc.

"It certainly makes sense for them to act together as a way of pressing the developed world to make the global organizational structure more optimal," said Jim O'Neill, Goldman Sachs head of economic research and author of the original BRICs report.

Multilateral institutions created after the Second World War are increasingly divorced from the economic and geopolitical realities of the 21st century. The BRIC nations want greater clout in the United Nations, the IMF and the World Bank, and the G8 club of rich nations looks increasingly irrelevant.

"The financial crisis exposed fundamental flaws in global governance," the World Economic Forum said in its 2009 Global Risks report. "Global risks know no borders and global solutions are also beyond the realm of any one government."

MARRIAGE OF CONVENIENCE

Not only has the crisis underlined the need for more inclusive institutions, it has also further tipped the balance of economic power toward strong emerging economies -- China in particular -- that are essential to global recovery.

The G20 has gained in importance as a global forum as a result of the world economic meltdown, but many analysts say it is too unwieldy to be fully effective. O'Neill argues that the G8 should consolidate its European Union members into a single representative, allowing China, India and Brazil to join.

The BRIC alliance is likely to last as long as the bloc is an effective pressure group for greater representation, and a counterweight against U.S. hegemony over global governance.

Few analysts doubt that they will win their struggle for greater say in key multilateral institutions. But then what?

"Beyond that critical issue, there is nothing that really binds them together," O'Neill said. "Once it was achieved, there would be much less reason for them to band together."

Even now, it is apparent that Brazil and Russia are keener on the idea of a BRIC bloc than India and China. For Brazil, the reason is clear -- it has the least global clout of the four, and it wants to team up with the others to remedy that. Brazil also has no obvious strategic conflicts with the other three.

For Russia, the calculus is more complex. It is a permanent veto-wielding member of the UN Security Council, and also wields global influence through the G8. But its G8 membership is shaky, with regular calls from other nations to boot it out.

"Russia enjoys its G8 status. They hate the G20 because they don't get any attention -- when you broaden it out to the G20 you discover there are far more important players in the global economy, and on issues like climate change, than Russia," said Alastair Newton, senior political analyst at Nomura in London.

Backing the BRIC bloc is a way for Russia to guard against being pushed out of the G8, or being lost in the G20.