Elvira Nabiullina, the governor of the Central Bank of the Russian Federation, spoke at the second meeting of BRICS finance ministers and central bank governors, noting that the risks of a slowdown in BRICS economic activity have intensified. The remarks were reported by TASS as a careful assessment of the bloc’s outlook amid a persistently challenging global backdrop. Nabiullina framed the discussion around the need to monitor a mix of domestic resilience and external pressures that could confront each BRICS member differently. The message she delivered was not a single forecast but a call to vigilance about the path ahead, recognizing that the BRICS economies, while diverse, share many common vulnerabilities. She underscored the importance of policy coordination at a time when global liquidity conditions, commodity markets, and geopolitical tensions interact in new ways. The overall tone suggested a willingness to continue dialogue within BRICS, balancing growth aspirations with the realities of a world economy that can swing on short notice. Observers highlighted that her comments align with broader analyses from regional central banks about how external shocks can reverberate through emerging markets and impact domestic inflation and growth trajectories.
She noted that global activity continued to expand into the third quarter of 2024, but the pace was uneven and downside risks had begun to accumulate. The external environment for most economies remained difficult, with demand, financing conditions, and geopolitical tensions shaping the trajectory. The commentary highlighted how a fragile external environment could nudge BRICS growth lower if shipping costs, energy prices, or trade restrictions deteriorate. In this context, Nabiullina urged a balanced approach that respects macro stability while promoting investment in productivity, digitalization, and human capital, so that BRICS can weather shocks without sacrificing long-term development. The message emphasized the importance of structural reforms, prudent policy, and regional cooperation to bolster resilience in a volatile global landscape.
Beyond geopolitical concerns, Nabiullina drew attention to the rising risks of global financial fragmentation. A more fragmented financial system could complicate cross-border financing, widen interest rate differentials, and disrupt policy transmission for emerging markets. Sharp shifts in capital flows, currency volatility, and divergent monetary policies could raise borrowing costs and slow investment, especially for infrastructure and energy projects that BRICS economies rely on. The consequences would echo across commodity exporters, affecting funding conditions, project viability, and growth momentum. In this environment, robust macroprudential frameworks, diversified funding strategies, and regional cooperation become essential as policymakers strive to maintain stability and sustainable expansion for their economies.
One lens for understanding these shifts is the changing distribution of global output. The United States’ share in the world economy declined to 14.82 percent by the end of 2023, a level that contrasts sharply with the late 20th century when the US accounted for roughly one-fifth of global GDP. The peak occurred in 1999, when the figure reached 21.01 percent. Meanwhile, China’s share climbed to about 18.76 percent, illustrating a sustained rebalancing of economic weight across regions. These dynamics reflect how demand, technology, and manufacturing power are migrating across borders, with BRICS economies positioned to benefit from broader diversification and deeper ties to dynamic markets. The evolving balance of power underscores the need for adaptable policy responses that can navigate external demand shifts and the actions of major economies on the global stage.
Analysts also look to IMF findings on how tensions in the Middle East influence the global economy. The IMF has underscored channels through which higher energy prices, potential supply disruptions, and increased risk aversion can affect growth in both advanced and developing economies. For BRICS and other large economies, the implications point to the value of credible inflation management, disciplined fiscal planning, and diversified trade relationships to withstand energy-market volatility and geopolitical shocks. The broader takeaway is that regional tensions send ripples through energy markets, financial conditions, and inflation expectations, inviting policymakers to prioritize resilience through prudent debt management, flexible policy instruments, and collaborative economic stewardship.