Is the balance of global economic power shifting? Recent analysis suggests BRICS is now richer than G7 countries, a statement that's gaining traction. This isn't about total GDP, but purchasing power parity (PPP), a more nuanced way of comparing economic strength. The BRICS countries overtook the G7 countries share of the world's total gross domestic product (GDP) in terms of purchasing power parity (PPP) in 2025. This milestone highlights the growing influence of Brazil, Russia, India, China, and South Africa on the world stage.

But what does this really mean? A significant factor is population size. By 2025 The G7 countries (800 million) account for about 10% of the world’s population, while India and China comprise about 35% (BRICS: 3.2 billion). This demographic advantage contributes significantly to the collective economic output measured by PPP.

The shift in economic power also has implications for the global financial system. The G7, traditionally dominant in international finance, is facing challenges. However, G7’s Moscow is now proposing changes to cross-border payments between BRICS countries, a system that would circumvent the global financial system and help strengthen intra-BRICS trade and reduce reliance on traditional Western-dominated financial institutions.

The fact that BRICS is now richer than G7 in PPP terms doesn't diminish the individual economic power of countries like the United States, Germany, or Japan. However, it signals a significant shift in the global economic landscape, with BRICS nations increasingly playing a pivotal role in shaping the future of global finance and trade. Understanding the nuances of PPP and the implications of alternative financial systems is crucial to navigating this evolving world economy.