This year’s annual BRICS summit was centred around “building stronger solidarity and co-operation amongst emerging markets”. Hosted by South Africa, president Cyril Ramaphosa stood ready to welcome state leaders Vladimir Puth, Xi Jinping, Narenda Modi and Micheal Temer. Determined to enhance the socio-economic status of the member states, the leaders negotiated possible strategies aimed at fulfilling the needs and urgencies of the BRICS member states. The summit took its course on the 25-27 July 2018 at the Sandton Convention Centre.
BRICS was established as a formal institute in 2001 through the publication of Chief Economist, Jim o’ Niel’s, “building better global economic BRICS”. Member states include the following developing countries: Brazil, Russia, India, China and South Africa. Leaders, businessmen and societal delegations of these respective states assemble to discuss issues concerning global economic urgencies while simultaneously suggesting possible implementation strategies aimed at addressing these urgencies. Jim O’ Niel predicted that BRICS would overtake the six largest western economies by 2041. The statistics supports Niels prediction with the BRICS entity continuously growing, averaging at 3.8% In 2015, 4.2% in 2016 and 5.1% in 2017.
In addition to the state leaders mentioned above, advocates from the African Union, United Nations and nine other African countries were present to represent the concerns of their people.
BRICS accounts for one fifth of the world’s economic output and 40% of its population. The union of intellectuals from these nations allow for more creative and strategic thinking. It also offers nations support through the establishment of units such as the “New Development Bank (NDB)”. The bank was set up in New Delhi 2012 to mobilise resources for infrastructure and sustainable development projects. The bank can also be utilised to compensate for temporary state losses in the form of a loan. In 2014 the “Contingency Reserve Agreement” was established to assist underdeveloped and emerging markets in the case of short-term liquidity pressure. Approximately R1.35trn was in the dispense of member states. This agreement decreases the BRICS states dependency on the World Bank or The International Monetary Funds for state loans, allowing them to act independently of large western economies.
South Africa was not always a part of BRICS establishment. It was only in December 2010 when South Africa became one of the member states. The reason as to why BRIC (former name) wanted South Africa as a member is still uncertain. It could be due to South Africa’s rich supply of coal and minerals thus hinting at the probable future wealth of the country.
To South Africa, being a member of BRICS is a means to better the state of the nation. With South Africa’s slow growth rate currently standing at 0.9%, increasing unemployment rates, decreasing gross domestic product (GDP) and increasing gross debt rate the country is in desperate need of resources- resources provided through BRICS partnership. In august 2017 the Africa Regional Centre (ARC) was established as a branch of the NDB. The centre is aimed at contributing to infrastructure development in the South African Development Community (SADC) and Africa. In addition to South Africa receiving a R2.6 bn loan to upgrade Transnet infrastructure, the Eskom dormant loan of R2.3 bn was recently reactivated. To put South Africa on similar financial ranking as the larger member states, a possible R8bn could be granted to the nation. With the correct mobilisation and allocation of resources, South Africa should be able to generate an income sufficient enough to cover the loan and occurring interest rates.
South Africa’s proposals on the agenda:
- The establishment of a working group on peace keeping
- The establishment of a vaccine research centre with the collaboration of the BRICS vaccine innovation and development partners
- The establishment of a BRICS gender and women’s forum
- Investing in a strategy from BRICS economic partnership toward the pursuit of inclusive growth advancing the 4th industrial revolution- initiating discussions subjected to dealing with opportunities and difficulties presented in the face of the revolution
- The establishment of a BRICS tourism track of co-operation
written by Sameera Reid Intern writer, Wits student Physiotherapy at UniMedia Pro