The planned accession of Iran into the BRICS+ group of countries announced on August 24 could be revolutionary for the Islamic Republic, a country largely isolated from the rest of the world given the shackles stemming from four decades of international sanctions applied by the United States and other Western nations. Now it will become a member of an exclusive emerging market club backed by the most powerful developing markets.

The five-member BRICS group has extended an offer of membership to six new countries in all, with half of them in the Middle East: the six are Argentina, Egypt, Ethiopia, Iran, the Kingdom of Saudi Arabia (KSA) and the United Arab Emirates (UAE).

A senior adviser to Iran's president, posting a reaction on social media platform X, hailed the country's forthcoming admission to the BRICS grouping as a “triumph of diplomacy” for the Islamic Republic.

"Permanent membership in the group of global emerging economies is considered a historic development and a strategic success for the foreign policy of the Islamic republic," Mohammad Jamshidi wrote on August 24.

South African President Cyril Ramaphosa announced the BRICS expansion on stage in the presence of the leaders of the other BRICS-member countries, minus Vladimir Putin who was unable to attend because of an international warrant for his arrest issued by the International Criminal Court (ICC) in March for kidnapping Ukrainian children.

The accession of the new members will take effect as of January 1, 2024. The debate over expanding the BRICS bloc, comprising Brazil, Russia, India, China and South Africa, has topped the agenda at the three-day summit in Johannesburg ending on August 24. While all BRICS members have publicly expressed support for growing the bloc, there were, however, divisions among the leaders over what sort of organisation they want to build and how aggressive it will be in confronting the West.

Iran’s president, Ebrahim Raisi, arrived in Pretoria on the morning of August 24 to participate in the 15th BRICS summit, following several months of lobbying by Tehran to get into the bloc. Upon his arrival, Raisi was greeted by the Minister of Trade and Industry of South Africa, Ebrahim Patel, the official website of Iran’s president (president.ir) reported.

During the day, Raisi had official and unofficial meetings with officials of several countries including Saudi Arabia, another of the invited members of the group. Tehran has made it a priority to pursue a multilateral foreign policy by seeking to enhance collaboration with countries in the global south, which are less aligned with Washington.

The expansion of BRICS into BRICS+ could potentially have serious ramifications for global trade, with a push by Russia and China to trade in their local currencies instead of the US dollar. While switching out of the dollar has been widely discussed, as bne IntelliNews has reported, abandoning the dollar remains very difficult and is unlikely to happen quickly.

Iran, under sanctions and barred from trading in dollars, would be, along with Russia, one of the biggest winners of a new BRICS currency if it comes to be. Brazilian President Luiz Inácio Lula da Silva has also proved a big fan of a new non-dollar bill of exchange and has already suggested a South American equivalent of the euro for interregional trade. At the same time Russia and China have been actively replacing the dollar for national currencies in settling mutual trade.

The entrance of the Islamic Republic to BRICS could also be the catalyst for a turnaround of the Iranian economy which has suffered from years of economic mismanagement, partly due to its isolation from global trading partners. Iran was officially welcomed as a full member of the Shanghai Cooperation Organization (SCO) on July 4 this year. Additionally, Tehran is currently engaged in free trade discussions with the Moscow-led Eurasian Economic Union (EEU), with hopes of reaching an agreement by the end of 2023.

Iranian Foreign Minister Hossein Amir Abdollahian announced in early June that Iran's membership in the BRICS alliance would be welcomed. After a BRICS foreign ministers meeting in South Africa, he stated that all five member countries agreed to support Iran's membership initiation.

The member states of BRICS represent more than 40% of the world's population and approximately 25% of the world's GDP.

The group is expected to exceed the economic growth expectations of G7 nations led by the US in the near future, according to certain analysts.

Moscow and Beijing are collaborating through BRICS to enhance a counterbalance against the Western-led international system.

The BRICS nations continue to push the creation of a new currency, similar to the euro, to further promote their financial independence.

Many countries, especially those facing US sanctions, are embracing the idea. Russia and China continually promote the settling of more of their mutual trade using their own currencies.

The Iranian government has, meanwhile, backed the creation of a gold-backed currency to compete with the US dollar.