The western media has been dismissive of the BRICS move to set up a bank, but such cynicism misses the larger picture — the end of western hegemony and the rise of the multiplex world 

For the first time since its creation in the aftermath of World War II, the structure of global economic governance established and dominated by the United States has some serious competition. At their summit in Brazil on July 15, 2014, the five BRICS countries (Brazil, Russia, India, China and South Africa) agreed to set up the New Development Bank with a capitalisation of U.S. $100 billion) and a contingency fund to deal with financial crises.
It is too early to say whether these mechanisms will challenge the role of the International Bank for Reconstruction and Development (IBRD) or the World Bank and the International Monetary Fund (IMF), which have been the bedrock of the Bretton Woods system under U.S. hegemony. But they at least serve as a reminder that the era of Western and American dominance of the world is ending, giving way to a more complex and diversified world order: the multiplex world. The move by BRICS, though outwardly economic in nature, has serious geopolitical undertones.
It comes after a speech last May to the U.S. Military Academy in West Point by U.S. President Barack Obama in which he declared: “America must always lead on the world stage. If we don’t, no one else will.” Such remarks would seem arrogant and dismissive of the ambitions of the emerging powers. The BRICS nations do not accept the view that the world is for America’s alone to lead or manage. The BRICS summit in Brazil also showed that the emerging powers do not buy the Obama administration’s move to punish Russia for its actions in Ukraine by isolating it internationally.
Domination from the West

To compound matters, recent developments, including the deterioration of U.S.-Russian relations over Ukraine and U.S.-China relations over East Asian maritime disputes casts a shadow over cooperation among the major powers in advancing global governance. One potential victim could be the G-20. Created in 1999 in response to the Asian financial crisis, G-20 was upgraded to a summit-level conclave of established and emerging nations in 2008, to manage the unfolding global financial crisis. Representing 80 per cent of the world’s population, 90 per cent of the world’s GDP, 90 per cent of the world’s finance, and 80 per cent of the world’s trade, this institution describes itself (at its Pittsburg Summit in September 2009) as the “world’s premier forum for international economic cooperation.” There is little doubt that it is vital to the future of global governance. Javier Solana, the former NATO and EU foreign policy chief, has called the G20, “the only forum in which world powers and emerging countries sit as equals at the same table.”
 The move by BRICS, though outwardly economic in nature, has serious geopolitical undertones 
G-20 is already viewed by the emerging powers as being dominated by the West, with too many European members and not enough representation from the developing world. And its efforts to reform the global institutions have lost momentum. This gives an added significance to the BRICS bank and fund set up in Brazil.
Hardened attitude

In the meantime, the U.S. attitude towards the emerging powers seems to have hardened. In 2010, the U.S. Secretary of State, Hillary Clinton, expressed the determination of the U.S. “to deepen engagement with these emerging centres of influence.” As she put it, “American leadership does not mean we do everything ourselves. We contribute our share, often the largest share, but we also have high expectations of the governments and peoples we work with.”
But in a speech delivered on June 11, 2014, closely following Mr. Obama’s “America must always lead” doctrine at West Point, U.S. National Security Adviser Susan Rice declared: “With emerging powers we must be able to collaborate where our interests converge but define our differences and defend our interests where they diverge.”
With relations with two of the BRICS countries — Russia and China — under serious strain over Ukraine and maritime disputes in East and Southeast Asia respectively, Washington’s commitment and ability to develop a shared leadership structure that Ms. Clinton had envisaged looks increasingly doubtful, if not altogether impossible. In this context, the mainstream western media has been too dismissive of the latest move by BRICS to set up a bank and contingency fund. But such cynicism misses the larger picture, which is the end of western hegemony and the rise of the multiplex world. A better response from the U.S. and the West would be to speed up the reform of the IMF and the World Bank so that they accommodate the rising clout of the emerging powers.
(Amitav Acharya is professor of international relations at American University, Washington, DC.)