tag:theconversation.com,2011:/global/topics/new-development-bank-19392/articlesNew Development Bank – The Conversation2023-08-24T18:37:30Ztag:theconversation.com,2011:article/2122002023-08-24T18:37:30Z2023-08-24T18:37:30ZBrics expansion: six more nations are set to join – what they’re buying into<p>One key outcome of the <a href="https://brics2023.gov.za/">15th Brics summit</a>, hosted by South Africa, is the decision to invite six more countries to join the group with effect from January 2024. They are Argentina, Ethiopia, Iran, Saudi Arabia, Egypt and the United Arab Emirates. All six had <a href="https://www.reuters.com/world/brics-meet-with-friends-seeking-closer-ties-amid-push-expand-bloc-2023-06-02/">applied</a> for membership. The enlargement will grow the association’s membership to 11, and increase its envisaged role as a geopolitical alternative to global institutions dominated by the west.</p>
<p>The five current member countries – Brazil, Russia, India, China and South Africa – have argued that their size, in economic and population terms, was not represented in the world’s institutions, particularly the World Bank and the International Monetary Fund (IMF). </p>
<p>The Brics five represent about <a href="https://unctad.org/publication/brics-investment-report">42%</a> of the world’s population and more than 23% of <a href="https://brics2023.gov.za/evolution-of-brics/">world GDP</a>. </p>
<p>The enlarged grouping will account for 46.5% of the world population. Using <a href="https://www.imf.org/external/datamapper/NGDPD@WEO/OEMDC/ADVEC/WEOWORLD/CHN">IMF GDP data</a>, we can deduce that it will account for about 30% of global GDP.</p>
<p>The disparate nature of the six new members is bound to spark debate about the real nature of Brics.</p>
<p>In his <a href="https://www.thepresidency.gov.za/speeches/address-president-cyril-ramaphosa-south-africa%27s-foreign-policy">welcoming remarks</a> at the summit (22-24 August), the host, South African president Cyril Ramaphosa, stated:</p>
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<p>Brics stands for solidarity and for progress. Brics stands for inclusivity and a more just, equitable order. Brics stands for sustainable development.</p>
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<p>The group has been remarkably consistent on these values and aspirations.</p>
<h2>Understanding the nature of Brics</h2>
<p>One of the first questions about Brics is often “what is it?”. This is telling. This question does not come up, for example, about the European Union or even the G20. </p>
<p>Brics is not an organisation (it has no headquarters, secretariat or treaty). But it does have a formal institution that is jointly owned – the <a href="https://www.ndb.int/">New Development Bank</a>. Confusion about Brics’ precise nature is understandable. </p>
<p>At various points it has referred to itself as a <a href="http://brics2022.mfa.gov.cn/eng/hywj/ODS/202203/t20220308_10649517.html">forum</a>, a <a href="http://www.brics.utoronto.ca/docs/210909-New-Delhi-Declaration.html">platform</a>, a <a href="http://www.brics.utoronto.ca/docs/130327-statement.html">mechanism</a>, a <a href="http://www.brics.utoronto.ca/docs/110414-leaders.html">partnership</a>, or a <a href="http://www.brics.utoronto.ca/docs/150709-ufa-declaration_en.html">strategic partnership</a>, to name a few. Others have called it an <a href="https://www.researchgate.net/publication/373113580_The_BRICS_and_Africa's_Strategic_Interests">alliance</a> or a bloc. It is neither. </p>
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<p>In international relations, both terms are strictly defined. The term “<a href="https://scientiamilitaria.journals.ac.za/pub/article/view/390/425">alliance</a>” refers to a mutual defence pact and implies military cooperation. A “<a href="https://www.jstor.org/stable/40209394">bloc</a>” refers to ideological consistency (political bloc) or a free trade agreement (trade bloc). Brics has none of these characteristics. </p>
<p>The members also disagree on some key issues. China and Russia are noncommittal (at best) on the aspirations of India, Brazil and South Africa to become members of the UN Security Council. Their declarations have over the years <a href="https://www.fmprc.gov.cn/eng/wjdt_665385/2649_665393/202206/t20220623_10709037.html">reiterated</a> the same phrase:</p>
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<p>China and Russia understand and support the aspirations of India, Brazil and South Africa to play a greater role in the United Nations. </p>
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<p>This shows there is some serious disagreement within the group. </p>
<p>As a political scientist interested in global politics, I have <a href="https://link.springer.com/book/10.1007/978-3-030-62765-2">written about Brics</a> and its potential for changing the status quo. With hindsight, I can assert that certain principles have informed it since its establishment and <a href="http://www.brics.utoronto.ca/docs/090616-leaders.html#:%7E:text=We%20call%20upon%20all%20parties,the%20WTO's%20Doha%20Development%20Agenda.">first summit</a> in 2009. In my view, at a material level, the 15 years of summit declarations point to four fundamental values:</p>
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<li><p>mutual development</p></li>
<li><p>multilateralism</p></li>
<li><p>global governance reform</p></li>
<li><p>solidarity.</p></li>
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<p>The association self-reportedly seeks secure sustainable development for itself and the global south, to safeguard and advance multilateralism, to institute reform for the goal of representative institutions, and to achieve solidarity among members.</p>
<h2>Economic development</h2>
<p>Economics comes first in the group; at its root, it is a collective of emerging economies eager to sustain and improve their economic trajectory. Their insistence on reform is, after all, based on their perceived disproportionate under-representation in global financial institutions.</p>
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<p>The group’s first, and so far only, notable establishment is the <a href="https://www.ndb.int/">New Development Bank</a>, primarily to finance infrastructure development. There’s also a contingent reserve that members can draw from in emergencies. It is <a href="https://saiia.org.za/research/the-brics-new-development-bank-and-contingent-reserve-arrangement-at-a-glance/''">valued at US$100 billion</a>. </p>
<h2>Multilateralism</h2>
<p>The second value refers to the group’s concern about the use of entities outside the UN to pursue global objectives. Most notable is the use of the North Atlantic Treaty Organisation (<a href="https://www.nato.int/nato-welcome/">Nato</a>) to invade <a href="https://www.cfr.org/timeline/us-war-afghanistan">Afghanistan</a> in 2001 following the <a href="https://www.911memorial.org/911-faqs">9/11</a> attacks in the US, and the invasion of Iraq in 2003 by the US and the UK, circumventing the UN Security Council. </p>
<p>Russian president Vladimir Putin expressed <a href="http://en.kremlin.ru/events/president/transcripts/24034">this concern in his speech</a> to the 2007 Munich Conference on Security:</p>
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<p>The use of force can only be considered legitimate if the decision is sanctioned by the UN. And we do not need to substitute NATO or the EU for the UN. </p>
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<h2>Global governance reform</h2>
<p>Thirdly, the Brics countries have long pushed for leaders of global institutions to be elected in a transparent and democratic way. For example, the president of the World Bank has <a href="https://fortune.com/2019/01/11/next-world-bank-president-jim-yong-kim/">always been an American</a>, and the managing director of the IMF <a href="https://foreignpolicy.com/2011/05/18/why-is-the-imf-chief-always-a-european/">a European</a>. The World Bank has <a href="https://www.worldbank.org/en/about/leadership#:%7E:text=The%20World%20Bank%20is%20like,policymakers%20at%20the%20World%20Bank.">189 member states</a> and the <a href="https://www.imf.org/en/About/Factsheets/IMF-at-a-Glance">IMF 190</a>.</p>
<p>The idea of the New Development Bank was not to substitute the World Bank but to “<a href="http://www.brics.utoronto.ca/docs/140715-leaders.html">supplement</a>” existing international financial institutions. Brics still envisions a World Bank in which its members have voting rights proportional to their economic weight, and with staff drawn from across the world in a geographically balanced way. </p>
<h2>Solidarity</h2>
<p>Finally, the members have articulated solidarity with one another in a number of declarations, beginning in 2010. It comes down to mutual assistance in times of humanitarian disasters, respecting one another’s sovereignty and territorial integrity. </p>
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<p>In light of criticism and sanctions plans against <a href="https://www.aljazeera.com/economy/2023/3/29/us-sanctions-chinese-firms-over-alleged-abuses-of-uyghurs">China</a>, for its alleged suppression of the Uyghur-Muslim population, and <a href="https://ofac.treasury.gov/sanctions-programs-and-country-information/ukraine-russia-related-sanctions">Russia</a>, for invading Ukraine, solidarity has come to mean silence or nonalignment. </p>
<h2>A blank slate</h2>
<p>Brics is a nebulous entity. This has proved beneficial for member countries hosting Brics summits. They get to set the agenda and use it for their ends – without upsetting the consensus. One common pattern has been the use of summits to set overarching themes that are favourable to the host country’s domestic policy and regional leadership or foreign policy stance.</p>
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<p>Thus, for example, all Brics summits hosted by South Africa foregrounded Africa in their names: “Brics and Africa: Partnership for mutually accelerated growth, sustainable development and inclusive multilateralism” <a href="https://brics2023.gov.za/theme-and-priorities/">in 2023</a>. Brazil and Russia have inserted issues that are important to their region, and often invited leaders of neighbouring countries to retreats.</p>
<p>This shows how much clout they enjoy, as they get to funnel access to a now-renowned association that is simultaneously well established but also evades easy definition. With the addition of the six new members, such evasiveness is set to only continue.</p><img src="https://counter.theconversation.com/content/212200/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Bhaso Ndzendze does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The disparate nature of the six prospective members is bound to spark debate about the real nature of Brics.Bhaso Ndzendze, Associate Professor (International Relations), University of JohannesburgLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2105072023-08-06T08:47:35Z2023-08-06T08:47:35ZAn expanded BRICS could reset world politics but picking new members isn’t straightforward<figure><img src="https://images.theconversation.com/files/540476/original/file-20230801-18384-y0dg77.jpg?ixlib=rb-1.1.0&rect=16%2C127%2C2813%2C1757&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">President Cyril Ramaphosa will host the 15th BRICS Summit in Johannesburg.</span> <span class="attribution"><span class="source">Government Communication and Information System</span></span></figcaption></figure><p>Eager to <a href="https://lmc.icds.ee/lennart-meri-lecture-by-fiona-hill/">escape perceived western domination</a>, <a href="https://www.voanews.com/a/more-countries-want-to-join-brics-says-south-africa-/7190526.html#:%7E:text=Argentina%2C%20Iran%2C%20Saudi%20Arabia%20and,nations%20have%20in%20the%20organization.">several countries</a> – mostly in the global south – are looking to join the <a href="https://brics2023.gov.za/#">Brics</a> bloc. The five-country bloc (Brazil, Russia, India, China and South Africa) is also looking to grow its global partnerships. </p>
<p>What <a href="https://www.gov.za/events/fifth-brics-summit-general-background">began in 2001</a> as an acronym for four of the fastest growing states, BRIC (Brazil, Russia, India and China), is projected to account for 45% of global GDP in purchasing power parity terms by 2030. It has evolved into a political formation as well.</p>
<p>Crucial to this was these countries’ decision to form their own club <a href="http://infobrics.org/page/history-of-brics/">in 2009</a>, instead of joining an expanded G7 as envisioned by former Goldman Sachs CEO <a href="https://www.goldmansachs.com/intelligence/archive/building-better.html">Jim O’Neill</a>, who coined the term “Bric”. <a href="https://link.springer.com/book/10.1007/978-3-030-97397-1">Internal cohesion</a> on key issues has emerged and continues to be refined, despite challenges.</p>
<p>South Africa joined the group after a Chinese-initiated invitation <a href="https://www.gov.za/events/fifth-brics-summit-general-background">in 2010</a>; a boost for then president Jacob Zuma’s administration, which was eager to pivot further to the east. The bloc also gained by having a key African player and regional leader. </p>
<p>Ever since, the grouping has taken on a more pointedly political tone, particularly on the need to <a href="https://www.gov.za/speeches/10th-brics-summit-johannesburg-declaration-27-jul-2018-0000#:%7E:text=We%20recommit%20our%20support%20for,democracy%20and%20the%20rule%20of">reform global institutions</a>, in addition to its original economic raison d’etre.</p>
<p>The possibility of its enlargement has dominated headlines in the run up to its 15th summit in Johannesburg <a href="https://brics2023.gov.za/about-the-summit/">on 22-24 August</a>. </p>
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<a href="https://theconversation.com/when-two-elephants-fight-how-the-global-south-uses-non-alignment-to-avoid-great-power-rivalries-199418">When two elephants fight: how the global south uses non-alignment to avoid great power rivalries</a>
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<p>We are political scientists whose <a href="https://www.barnesandnoble.com/w/the-political-economy-of-intra-brics-cooperation-siphamandla-zondi/1140951138">research interests</a> include <a href="https://link.springer.com/book/10.1007/978-3-030-62765-2">changes</a> to the global order and emerging alternative centres of power. In our view, it won’t be easy to expand the bloc. That’s because the group is still focused on harmonising its vision, and the potential new members do not readily make the cut. </p>
<p>Some may even bring destabilising dynamics for the current composition of the formation. This matters because it tells us that the envisioned change in the global order is likely to be much slower. Simply put, while some states are opposed to western <a href="https://www.fmprc.gov.cn/mfa_eng/wjbxw/202302/t20230220_11027664.html">hegemony</a>, they do not yet agree among themselves on what the new alternative should be. </p>
<h2>Evolution of BRICS</h2>
<p>BRICS’ overtly political character <a href="https://link.springer.com/chapter/10.1007/978-3-030-62765-2_1">partially draws</a> on a long history of non-alignment as far back as the <a href="https://www.britannica.com/event/Bandung-Conference">Bandung Conference of 1955</a>. It was attended mostly by recently decolonised states and independence movements intent on asserting themselves against Cold War superpowers – the Soviet Union and the United States. </p>
<p>BRICS has come to be viewed as <a href="https://journals.sagepub.com/doi/full/10.1177/13540661231183352">challenging the counter hegemony</a> of the US and its allies, seen as meddling in the internal affairs of other states. </p>
<p>Reuters estimates that <a href="https://www.reuters.com/world/more-than-40-nations-interested-joining-brics-south-africa-2023-07-20/#:%7E:text=South%20African%20officials%20want%20BRICS,Kazakhstan%20have%20all%20expressed%20interest.">more than 40 states</a> are aspiring to join BRICS. South African diplomat Anil Sooklal says 13 had <a href="https://www.washingtonpost.com/business/energy/2023/05/28/how-brics-became-a-real-club-and-why-others-want-in/5caecc7e-fdb7-11ed-9eb0-6c94dcb16fcf_story.html">formally applied</a> by May 2023.</p>
<p>Many, though not all, of the aspiring joiners have this overtly political motivation of countering US hegemony. The other important incentive is access to funds from the BRICS’ <a href="https://www.ndb.int/projects/">New Development Bank</a>. This is especially pronounced in the post-COVID climate in which many economies are <a href="https://news.un.org/en/story/2023/05/1136727#:%7E:text=Prospects%20for%20a%20robust%20global,Prospects%20report%2C%20released%20on%20Tuesday.">yet to fully recover</a>. Of course the two can overlap, as in the case of Iran.</p>
<p>The notable applicants have <a href="https://www.reuters.com/world/europe/belarus-says-it-has-applied-join-brics-club-russian-ria-agency-2023-07-25/">included</a> Saudi Arabia, Belarus, <a href="https://theconversation.com/ethiopia-wants-to-join-the-brics-group-of-nations-an-expert-unpacks-the-pros-and-cons-209141">Ethiopia</a>, <a href="https://www.reuters.com/world/americas/argentina-says-has-chinas-support-join-brics-group-2022-07-07/">Argentina</a>, <a href="https://www.silkroadbriefing.com/news/2022/11/09/the-new-candidate-countries-for-brics-expansion/">Algeria, Iran</a>, Mexico, and <a href="https://www.aa.com.tr/en/turkiye/turkiye-obvious-nation-for-expanded-brics-says-leading-economist/2896122">Turkey</a>. </p>
<h2>Expanded BRICS</h2>
<p>A strategically expanded BRICS would be seismic for the world order, principally in economic terms. </p>
<p>Key among the club’s reported priorities is <a href="https://foreignpolicy.com/2023/04/24/brics-currency-end-dollar-dominance-united-states-russia-china/">reduction of reliance</a> on the US dollar (“de-dollarisation” of the global economy). One of the hurdles to this is the lack of buy-in by much of the world. Though some states may disagree with the dollar’s dominance, they still see it as the most reliable.</p>
<p>Given the extent of globalisation, it’s unlikely that there will be attempts to chip away at the west’s access to strategic minerals and trade routes as happened during the <a href="https://digitalarchive.wilsoncenter.org/document/speech-president-nasser-alexandria-july-26-1956-extract">Suez Crisis of 1956</a>, at the height of the Cold War.</p>
<p>Instead, the new joiners would likely use their new BRICS membership to better bargain with their western partners, having more options on hand.</p>
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<p>Herein lies the challenge (and the paradox) with BRICS expansion. On one hand, the grouping is not yet offering anything concrete to justify such drastic measures as de-dollarisation. On the other, the current five members also need to be selective about who they admit.</p>
<p>Among the considerations must surely be the track record of the applicants as well as their closeness to the west. The experience of having had a right-wing leader such as former Brazilian president <a href="https://theconversation.com/brazils-jair-bolsonaro-is-devastating-indigenous-lands-with-the-world-distracted-138478">Jair Bolsonaro</a> in its midst must have been a lesson about the need to be circumspect when admitting new members.</p>
<h2>Weighing the likely contenders</h2>
<p>In this regard, aspirants such as Saudi Arabia and Mexico seem the least likely to make the cut in the short term. That’s despite the Saudis’ oil wealth and Mexico’s <a href="https://www.voanews.com/a/obrador-mexico-first-leftist-president-in-decades/4463520.html">leftist-progressive</a> leader Andres Manuel Lopez Obrador. Although they might be currently experiencing rocky relations with Washington, they have proven to be capable of rapprochement following previous disagreements with the US, with which they seem inextricably intertwined. </p>
<p>Saudi Arabia has a long-term military relationship with the US, while Mexico is the US’s <a href="https://www.dallasfed.org/research/economics/2023/0711#:%7E:text=and%20border%20region-,Mexico%20seeks%20to%20solidify%20rank%20as%20top,partner%2C%20push%20further%20past%20China&text=Mexico%20became%20the%20top%20U.S.,four%20months%20of%20this%20year.">number-one trading partner</a>. </p>
<p>Of equal importance in the evaluation of potential new members is the relationship the aspirants have with the existing BRICS members. This is because another crucial lesson has been the tiff between two of its largest members, <a href="https://journals.sagepub.com/doi/10.1177/20578911221108800?icid=int.sj-abstract.citing-articles.1">China and India</a>, over their disputed border. As a result of the uneasy relationship between two of its members, the bloc has become alert to the importance of <a href="https://onlinelibrary.wiley.com/doi/epdf/10.1111/1758-5899.13010">direct bilateral relations and dispute resolution</a> among its constituent leaders.</p>
<p>Among the applicants, Saudi Arabia, which has had a fractious relationship with Moscow in the past, seems to face an uphill climb. It also has difficult relations with Iran, another applicant, despite their recent rapprochement.</p>
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<p>The country which seems the most suitable to join BRICS for ideological reasons, and will expand the bloc’s footing in the Caribbean, is Cuba. It enjoys strong ties with the existing members. It also has solid “counter-hegemonic” credentials, having been the bête noire of the US for more than 60 years. </p>
<p>Cuba is also a leader in the Latin American left and enjoys strong ties with many states in Central and South America (particularly with Guatemala, <a href="https://latinarepublic.com/2022/07/20/honduras-and-cuba-sign-a-memorandum-to-strengthen-bilateral-relations/">Honduras</a>, <a href="https://www.plenglish.com/news/2022/07/27/nicaraguan-fm-described-relations-with-cuba-as-endearing/">Nicaragua</a> and <a href="https://www.wilsoncenter.org/publication/venezuela-and-cuba-ties-bind">Venezuela</a>). Membership would boost its influence. </p>
<h2>Character matters</h2>
<p>If an expanded BRICS is to be an agent for change on the world scene, it will need to be capable of action. Having rivals, or states that are at least ambivalent towards each other, seems anathema to that.</p>
<p>Eager to proceed cautiously and expand strategically, the current BRICS states seems likely, at least in the short term, to pursue a <a href="https://www.silkroadbriefing.com/news/2022/11/09/the-new-candidate-countries-for-brics-expansion/">BRICS-plus</a> strategy. In other words, there may emerge different strata of membership, with full membership granted to states that meet the group’s criteria over time. </p>
<p>It is thus not mere expansion, but the character of the expansion which will guide the five principals on whether they grow from that number.</p><img src="https://counter.theconversation.com/content/210507/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Siphamandla Zondi is affiliated with the University of Johannesburg. </span></em></p><p class="fine-print"><em><span>Bhaso Ndzendze does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>It is not mere expansion, but the character of the expansion which will guide the five Brics countries on whether they admit new members.Bhaso Ndzendze, Associate Professor (International Relations), University of JohannesburgSiphamandla Zondi, Acting Director: Institute for Pan-African Thought & Conversation, University of JohannesburgLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2068982023-06-02T11:31:51Z2023-06-02T11:31:51ZSouth Africa’s role as host of the BRICS summit is fraught with dangers. A guide to who is in the group, and why it exists<figure><img src="https://images.theconversation.com/files/529635/original/file-20230601-21-wls2oa.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Chinese President Xi Jinping hosted the 14th BRICS Summit via video link in Beijing. South African President Cyril Ramaphosa, Brazilian President Jair Bolsonaro, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi attended the summit. </span> <span class="attribution"><span class="source">Li Tao/Xinhua via Getty Images</span></span></figcaption></figure><p><em>South Africa will <a href="https://www.dirco.gov.za/blog/2023/04/21/south-africa-to-host-brics-deputy-ministers-and-special-envoys-on-the-middle-east-and-north-africa/">host the BRICS summit in August 2023</a>. The event could offer the country an opportunity to exercise leadership in the BRICS’ efforts to reform the arrangements for global economic governance and in supporting sustainable and inclusive development in Africa and the Global South. However, the opportunity has morphed into an international challenge because Russia’s President Vladimir Putin, who has been <a href="https://www.theguardian.com/world/2023/mar/17/vladimir-putin-arrest-warrant-ukraine-war-crimes">indicted by the International Criminal Court</a>, has <a href="https://www.reuters.com/world/kremlin-says-russia-will-take-part-brics-summit-proper-level-2023-05-30/">indicated</a> that he will attend. South Africa could face the wrath of its BRICS partners if it fulfils its international obligation and arrests him. On the other hand, if it does not arrest him, it could face sanctions from those countries that want to see Putin tried for war crimes.</em> </p>
<p><em>Hosting the 2023 BRICS summit is therefore fraught with dangers. The international environment is complicated, dynamic and unpredictable. South Africa can avoid embarrassment and capitalise on the opportunities presented by the summit only if it is able to skilfully manoeuvre in these choppy waters.</em> </p>
<p><em>Trying to understand South Africa’s dilemma raises a number of questions: Who are the BRICS? What has the grouping achieved?</em> </p>
<hr>
<h2>Who are the BRICS?</h2>
<p>In 2001, the global investment bank Goldman Sachs stated that it expected Brazil, Russia, India and China to become leading actors in the global economy. It collectively named the four countries <a href="https://www.goldmansachs.com/our-firm/history/moments/2001-brics.html">“BRICs”</a>. </p>
<p>These countries decided that Goldman Sachs had a point and that they could enhance their global influence if they cooperated. They first met at a ministerial level in <a href="http://infobrics.org/page/history-of-brics/">2006</a> and at a leaders’ summit in <a href="http://infobrics.org/page/history-of-brics/">2009</a>. <a href="https://www.reuters.com/article/us-bric-safrica-idUSTRE6BN1DZ20101224">In 2010</a> they invited South Africa to join the group. The group became known as “BRICS”. </p>
<p><a href="https://unacademy.com/content/upsc/study-material/international-relations/brics-objectives-and-history/">A primary objective of the group </a> is to reform global economic governance so that it is more responsive to the concerns and interests of the Global South. For example, the BRICS have called for <a href="https://foreignpolicy.com/2023/04/24/brics-currency-end-dollar-dominance-united-states-russia-china/">a new global currency</a> that can challenge the dominant role of the US dollar in the international monetary system. It has also pushed for a greater voice – and more votes – for developing countries in key international economic organisations like the IMF and the World Bank.</p>
<p>The group has also sought, through groups like its <a href="https://sabricsbusinesscouncil.co.za/event/participate-in-the-business-activities-during-brics-summit-august-2023/">business forum</a>, to promote greater economic cooperation between the participating countries.</p>
<h2>What has the BRICS grouping achieved?</h2>
<p>The BRICS record of achievements is mixed. </p>
<p>In 2016, the group established two new international economic entities. </p>
<p>The first was the <a href="https://www.ndb.int/">New Development Bank</a>. They contend that it is a “new” multilateral development bank which offers its members an alternative to institutions like the World Bank. It claims that its governance is fairer than the World Bank because its five original members all have <a href="https://www.ndb.int/about-ndb/shareholding/">equal votes</a>. At the World Bank, shares (and therefore votes) are unevenly distributed among member states. </p>
<p>The development bank also strives to provide financing more quickly than the World Bank, and in a way that is more respectful of the laws in its member states. </p>
<p>However, to date, the New Development Bank has been <a href="https://theconversation.com/how-brics-new-development-bank-can-improve-transparency-and-accountability-186265">less transparent and accountable</a> than other multilateral development banks.</p>
<p>It has <a href="https://www.ndb.int/projects/">provided US$32.8 billion</a> to 96 projects in the 5 BRICS countries and it has begun looking to expand the scope of its operations. </p>
<p>Since 2021 it has approved membership for <a href="https://www.ndb.int/about-ndb/shareholding/">Bangladesh, Egypt, United Arab Emirates and Uruguay</a>. It is expected to add new members in the coming years. </p>
<p>The second new entity was the <a href="https://www.aspireias.com/upsc-study-notes/Contingent-Reserve-Arrangement-CRA-BRICS">Contingent Reserve Arrangement</a>. This established a series of swap arrangements between the BRICS central banks. These arrangements allow each central bank, when its country is facing a balance of payments crisis, to exchange its local currency for hard currencies, like the US dollar, with its counterparts in the BRICS. </p>
<p>Pursuant to the terms of the arrangement, a central bank can only draw on a fraction of the available financing without also having to enter into a financing arrangement with the IMF. Thus, the conditions that are attached to the IMF’s finances also become applicable to the funds made available through the Contingent Reserve Arrangement. </p>
<p>To date, no BRICS central bank has used the arrangement. </p>
<p><a href="http://www.brics.utoronto.ca/">According to their communiques</a>, the BRICS leaders have agreed to create other entities, such as a vaccine centre and a new credit rating agency. However, they have not yet implemented these agreements. </p>
<p>They have not been successful either in reforming the existing institutions and arrangements for global economic governance, such as the IMF. One reason for this failure is the strong opposition to reform from states, primarily those in Europe, which currently have dominant voices in the IMF and would lose them in the case of true reform. </p>
<p>But another important reason is that the BRICS are not unified in their demands for reform. For example, while Brazil, India and South Africa support reforming the UN Security Council to include more permanent members and to eliminate the veto power of the existing permanent members, China and Russia, as sitting permanent members, don’t. </p>
<p>Similarly, not all the other BRICS have supported South Africa’s call for a third African seat on the IMF’s board of directors. </p>
<h2>Are there any downsides to BRICS membership?</h2>
<p>The global political and economic situation has changed dramatically since 2010. These changes have created both opportunities and challenges for the BRICS. </p>
<p>One opportunity arises from the fact that <a href="https://www.japantimes.co.jp/news/2023/05/25/world/politics-diplomacy-world/brics-expansion-emerging-economies-join/">approximately 19 countries</a> in the Global South, including Argentina, Cuba, Iran and Saudi Arabia, have expressed an interest in joining the BRICS. It is expected that the BRICS will consider the issue of membership at their upcoming August 2023 summit. </p>
<p>Another opportunity arises from the growing interest around the world in having an alternative currency to the US dollar as the basis for the international financial system. The BRICS have been <a href="https://foreignpolicy.com/2023/04/24/brics-currency-end-dollar-dominance-united-states-russia-china/">vocal supporters of de-dollarisation</a>. However, given the complex economic and political relations between the BRICS member states, there is considerable scepticism about the feasibility of the BRICS developing a new global currency in the near term.</p>
<p>The primary challenges facing the BRICS arise from geopolitics. The war in Ukraine has created tensions within the BRICS. The participating states have been <a href="https://saiia.org.za/research/a-global-rebalance/">forced to balance their respect </a>for such international law principles as self-determination, sovereignty and peaceful resolution of disputes with their friendly relations with Russia. In addition, the BRICS cannot escape the fallout from the growing economic and security tensions <a href="https://www.economist.com/china/2023/04/27/chinas-latest-attempt-to-rally-the-world-against-western-values?gclid=CjwKCAjwpuajBhBpEiwA_ZtfhdEfPP2nUUq4vCYYTp3gK6av_gR71ro86sVIZKvEduRkmt7u6iwQ_xoCc7EQAvD_BwE&gclsrc=aw.ds">between China and the west</a>, particularly the US. </p>
<p>Both these issues complicate the efforts of the other BRICS to maintain their formal non-aligned position. They also exacerbate existing tensions within the BRICS. The most important example of this is the <a href="https://www.chathamhouse.org/2023/03/india-china-relations-quad-answer?__cf_chl_tk=8WwBOhRRpvovxPXN3HILt.MUbGy_.LyODow70NcSHds-1685690745-0-gaNycGzNDfs">complex and tense relationship</a> between India and China. In recent years, they have had military skirmishes in disputed border areas. In addition, India has imposed economic constraints on Chinese companies operating in India. The two countries <a href="https://www.wsj.com/articles/china-india-kick-out-nearly-all-of-each-others-journalists-as-rivalry-escalates-75d51c42">have refused to renew the visas of journalists</a> from each country so that now there are almost no journalists from Chinese publications in India and vice versa.</p>
<h2>What hangs on the summit?</h2>
<p>South Africa faces another opportunity that is fraught with danger when it hosts the G20 in 2025. The G20, which brings together the 20 leading economic powers in the world, has called itself <a href="https://www.cigionline.org/articles/premier-forum-making-g20-permanent/">the “premier forum” </a>for global economic governance. South Africa is currently the only permanent African member of the G20 and 2025 will be the first time the group is hosted by an African country. </p>
<p>Planning for this G20 event must begin soon because in 2024 South Africa will join India, the current G20 host, and Brazil, <a href="https://unacademy.com/content/upsc/study-material/international-relations/india-joins-g20-troika/">the 2024 G20 host in the troika</a> that manages the G20 process. If the country does not plan carefully and effectively for this G20 event, South Africa risks emerging with a diminished reputation and its credibility shredded.</p><img src="https://counter.theconversation.com/content/206898/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Danny Bradlow receives funding from the Open Society Foundation for a project unconnected to this article. He is also a Compliance Officer in the Social and Environmental Compliance Unit (SECU) at the UN Development Programme.</span></em></p>Geopolitics is forcing BRICS countries to balance respect for international law, self-determination, sovereignty and peaceful resolution of disputes with their friendly relations with Russia.Danny Bradlow, Professor/Senior Research Fellow, Centre for Advancement of Scholarship, University of PretoriaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1862652022-07-13T13:58:54Z2022-07-13T13:58:54ZHow BRICS’ New Development Bank can improve transparency and accountability<figure><img src="https://images.theconversation.com/files/472282/original/file-20220704-24-jd8a24.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The New Development Bank has not been forthcoming with information on its funding of South Africa's Medupi power station.</span> <span class="attribution"><span class="source">Getty Images</span></span></figcaption></figure><p>The New Development Bank, which was <a href="https://www.ndb.int/wp-content/themes/ndb/pdf/Agreement-on-the-New-Development-Bank.pdf">formed</a> in July 2014, marks its eighth birthday this year. It was formed by the leaders of Brazil, Russia, India, China and South Africa (BRICS) when they met in Fortaleza, Brazil for the bloc’s summit. The bank was seen as a potential alternative to the World Bank and able to take a new approach to development finance.</p>
<p>The New Development Bank has since approved <a href="https://www.ndb.int/projects/list-of-all-projects/?country_name=5">11 projects</a> in South Africa and Lesotho. These involve sustainable energy, transportation, water resource management, and a COVID-19 emergency loan programme. Some of these projects, for instance the <a href="https://www.ndb.int/environmental-protection-project-for-medupi-thermal-power-plant/">Environmental Protection Project for Medupi Thermal Power Plant</a>, are of strategic importance to South Africa. Of the project’s estimated total cost of US$2.75 billion, the bank is providing a US$480 million loan.</p>
<p>This is in line with hopes that the bank would serve as a much-needed new source of financing for national and regional initiatives. Another hope was that it would be more transparent and accountable than other multilateral banks such as the World Bank. Its <a href="https://www.ndb.int/about-us/essence/mission-values/">mission and values</a>, <a href="https://www.ndb.int/wp-content/themes/ndb/pdf/Agreement-on-the-New-Development-Bank.pdf">articles of agreement</a>, <a href="https://www.ndb.int/wp-content/themes/ndb/pdf/ndb-environment-social-framework-20160330.pdf">environmental and social framework</a> and <a href="https://www.ndb.int/wp-content/uploads/2017/01/information-disclosure-policy-revised.pdf">information disclosure policy</a> make commitments about transparency and openness. </p>
<p>The bank’s <a href="https://www.ndb.int/about-us/essence/mission-values/">mission statement</a> expresses its objective of not only “achieving development goals with transparency” but also displaying “empathy” towards its projects’ intended beneficiaries. </p>
<p>Billions of dollars of investment later, however, the reality suggests that improvement is needed.</p>
<p>A study on transparency and accountability by Oxfam South Africa and the University of Pretoria’s Centre for Human Rights raises concerns about how the bank handles <a href="https://www.oxfam.org.za/wp-content/uploads/2022/06/oxfam-ndb-accountability-discussion-paper-1-web.pdf">access to information</a>. It also lacks an <a href="https://www.oxfam.org.za/wp-content/uploads/2022/06/oxfam-ndb-accountability-discussion-paper-2-web.pdf">independent accountability mechanism</a>. The study calls into question whether the bank is showing empathy towards the communities that are affected by its projects.</p>
<h2>Too little openness</h2>
<p>The study highlights transparency and accountability challenges with some of the projects co-financed by the bank. The researchers interviewed representatives of the communities near the <a href="https://www.ndb.int/lesotho-highlands-water-project-phase-ii/">South Africa Lesotho Highlands Water Project Phase II</a> and the <a href="https://www.ndb.int/environmental-protection-project-for-medupi-thermal-power-plant/">Medupi project</a>.</p>
<p>Some of these challenges are cross-cutting. For instance, the representatives said that the influx of migrant workers into their communities had put a strain on resources and services. There were also project-specific issues. These included concerns about the resettlement of <a href="https://www.oxfam.org.za/wp-content/uploads/2022/06/oxfam-ndb-accountability-discussion-paper-1-web.pdf">more than 3,000 people</a> to make way for the Lesotho project.</p>
<p>The study demonstrates the difficulty of getting project information. The New Development Bank’s responses to information requests from the researchers lacked adequate detail. Without timely and comprehensive access to information, how can communities affected by projects adequately address their concerns? </p>
<p>The bank’s website has no project documents and its information portal is hard to use. This affects the right of communities to be heard, a right that can’t be exercised without access to information. </p>
<p>Unlike most <a href="https://www.worldbank.org/en/programs/accountability#:%7E:text=The%20World%20Bank%20Accountability%20Mechanism%20is%20an%20independent%20complaints%20mechanism,a%20World%20Bank%2Dfunded%20project.">multilateral development banks</a>, the New Development Bank doesn’t have an independent accountability mechanism. Nor does it have other ways for these communities to seek redress or hold it accountable. </p>
<p>Such mechanisms are created to <a href="https://www.ciel.org/wp-content/uploads/2021/06/Glass-half-full.pdf">hold development finance institutions</a> and their clients accountable to their own policies. They also provide access to remedies for individuals and communities that are adversely affected by the activities such institutions fund. Without such a mechanism, the bank’s approach to accountability falls far short of global best practice.</p>
<p>It’s clear that much more can be done to improve transparency and accountability at the New Development Bank. </p>
<h2>Looking ahead</h2>
<p>The bank could do this in several ways:</p>
<ul>
<li><p>It must put section 23 of its <a href="https://www.ndb.int/wp-content/themes/ndb/pdf/ndb-environment-social-framework-20160330.pdf#page=12">environment and social framework</a> into practice. This requires the bank to disclose project documents and information to communities and the general public during the project design and implementation phases, and throughout projects’ life cycles.</p></li>
<li><p>It should create a structure or platform, an independent accountability mechanism, that affected communities can use to prod the bank when it fails to provide timely access to project information or to comply with its own policies and procedures. Better and more sustainable development outcomes can be achieved when the mechanism’s design process includes public consultations that incorporate different stakeholders. These public consultations should aim to genuinely solicit inputs that influence the design and implementation of the proposed mechanism.</p></li>
</ul>
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Read more:
<a href="https://theconversation.com/south-africa-and-international-financial-institutions-a-liaison-group-could-recalibrate-relations-177643">South Africa and international financial institutions: a liaison group could recalibrate relations</a>
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<li>At a national level, there have also been calls for the formation of <a href="https://theconversation.com/south-africa-and-international-financial-institutions-a-liaison-group-could-recalibrate-relations-177643">a South African liaison group for international financial institutions</a>. This group would be a platform to promote discourse between South African government institutions such as the treasury and civil society concerning the country’s relationship with international financial institutions. This group could for instance be a good platform to discuss civil society’s concerns about the New Development Bank.</li>
</ul><img src="https://counter.theconversation.com/content/186265/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Magalie Masamba is a Post-doctoral Research Fellow at the Centre for Human Rights, University of Pretoria. She receives funding from Prof. Danny Bradlow's SARCHI Chair at the University of Pretoria and works on research projects funded by the Open Society Initiative for Southern Africa (OSISA) and Oxfam South Africa. </span></em></p>The New Development Bank doesn’t have mechanisms that communities can use to hold it accountable or seek redress.Magalie Masamba, Post-doctoral Fellow, Centre for Human Rights, University of PretoriaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1776432022-02-24T15:01:02Z2022-02-24T15:01:02ZSouth Africa and international financial institutions: a liaison group could recalibrate relations<figure><img src="https://images.theconversation.com/files/447744/original/file-20220222-13-f65vjm.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">South Africa has borrowed US$7bn from international financial institutions since the start of COVID.</span> <span class="attribution"><span class="source">Beata Zawrzel/NurPhoto via Getty Images</span></span></figcaption></figure><p>Since the onset of the COVID pandemic in 2020, South Africa has borrowed a total of about US$7 billion (about R106 billion). The money has come from the <a href="https://www.imf.org/en/News/Articles/2020/07/27/pr20271-south-africa-imf-executive-board-approves-us-billion-emergency-support-covid-19-pandemic">International Monetary Fund</a>, the <a href="https://www.news24.com/fin24/companies/health/sa-gets-new-1bn-loan-from-brics-bank-to-support-economic-recovery-20210408">New Development Bank</a>, the <a href="https://www.afdb.org/en/news-and-events/press-releases/south-africa-african-development-bank-approves-first-ever-crisis-response-budget-support-r5-billion-fight-covid-19-36964">African Development Bank</a>, and the <a href="https://www.worldbank.org/en/news/press-release/2022/01/20/south-africa-s-covid-19-response-gets-a-750-million-boost#:%7E:text=WASHINGTON%2C%20January%2020%2C%202022%20%E2%80%94,development%20policy%20loan%20(DPL)">World Bank</a>. </p>
<p>The country has assumed these debts without any transparent or accessible process of public consultation or publicly available studies of the expected impacts of these loans on poverty, public health, job creation and social welfare in the country.</p>
<p>This is concerning. The government’s obligation to repay these loans has financial, economic, social and possibly political implications for all South Africans. It could affect how much money the government can spend in the future on creating jobs, dealing with poverty and inequality in South Africa and on supporting the just transition to a carbon free economy.</p>
<p>It could also change the relationship between South Africa and these institutions, known collectively as the international financial institutions (IFIs). Instead of being merely organisations from which South Africa can obtain technical advice, they are now important creditors of the country. This can influence the balance of bargaining power and the tone of the government’s engagements with these institutions. It may also have important implications for South Africa’s long-standing efforts, together with partners in Africa, the <a href="https://infobrics.org/">BRICs</a>, and <a href="https://www.g77.org/doc/">G77</a> to <a href="https://www.pulp.up.ac.za/images/pulp/books/edited_collections/foreign_policy/SA%20Foreign%20Policy%20Book%20Chapter%2010.pdf">promote fairer governance of the global economy</a>.</p>
<p>A group of civil society organisations and academics, including myself, have responded to these concerns by proposing that <a href="https://www.timeslive.co.za/sunday-times/opinion-and-analysis/opinion/2022-02-20-sas-international-loans-an-open-letter-to-enoch-godongwana/">the government establish a South African IFI Engagement Group</a>. We maintain that such a group will enhance the efficacy of South Africa’s relations with the international financial institutions. This in turn should help the country extract the maximum possible benefit from its membership in these organisations while minimising the associated costs.</p>
<h2>How it would work</h2>
<p>Controversies relating to international financial institutions finance have two components. </p>
<p>The first focuses on the borrowing government’s own decisions and actions. Formally, the international financial institutions only provide financing to support the policies or the projects that the government is promoting. This means, for example, that the South African government decides on its policy response to the COVID-19 pandemic, and then decides that it will borrow money from the IMF or the African Development Bank to support this response. </p>
<p>Similarly, the state power utility Eskom and the government decide to build the <a href="https://www.eskom.co.za/eskom-divisions/gx/coal-fired-power-stations/medupi-projects/">Medupi coal-fired power plant</a> and then approach the World Bank <a href="https://documents1.worldbank.org/curated/en/945661577445675366/pdf/Disclosable-Restructuring-Paper-Eskom-Investment-Support-Project-P116410.pdf">to fund the project</a>.</p>
<p>Consequently, the government is the appropriate target of any criticism of these decisions. This includes its decision to accept the terms on which the institutions offer the financing.</p>
<p>The second set of considerations relate more to the international financial institutions’ own responsibilities. Most have policies that inform both their staff and the public about how they will assess and manage the impacts of the projects and programmes they finance. </p>
<p>For example, the local communities may contend that they have been harmed because the World Bank did not comply with its own policies <a href="https://www.worldbank.org/en/news/press-release/2012/05/25/world-bank-board-discusses-inspection-panel-report-on-south-africas-eskom-investment-support-project">when it made the decision to fund Medupi</a>. </p>
<p>The South African government is clearly not responsible for these decisions by the international financial institutions even though they directly affect communities. Nevertheless, it should have an interest in learning about these community concerns. Communities are not passive participants in the policies and programmes promoted by the government. They can influence their success and can complicate the government’s ability to access financing.</p>
<h2>A solution</h2>
<p>One way for the government to mitigate these risks is to create an engagement group.</p>
<p>The aim of the group would be to facilitate an exchange of views between the government and interested civil society stakeholders about the country’s relations with the international financial institutions.</p>
<p>The members of such a group would include representatives of National Treasury, other government departments and civil society. The civil society representatives would be selected from a range of organisations. These could include think tanks, and trade unions, interested in international financial institutions issues. </p>
<p>To promote a frank and open exchange of ideas, these meetings should be held under <a href="https://www.chathamhouse.org/about-us/chatham-house-rule?gclid=CjwKCAiAsNKQBhAPEiwAB-I5zdyxXCa4zr9HMMPlCEoGLr-RzbqwKEL23kCsjQWb50aOnV3WJahgtBoCVdIQAvD_BwE">Chatham House rules</a>. These are that those at the meeting can share the information they receive, but they don’t reveal the identity of who said it.</p>
<p>The agenda for the meetings could include any issue relating to South Africa’s engagement with any of the institutions in which South Africa is a member.</p>
<p>The group could provide a mechanism through which government could learn about concerns of affected communities before it finalises its borrowing plans. Or before they become potential threats to the success of a project. </p>
<p>For example, the civil society representatives would be in a better position to learn from local communities what their views are about a proposed renewable energy project to be funded by international financial institutions. They may be strongly opposed because they suspect that the jobs created by the project require skills that the community does not have. They may also be concerned that construction would adversely affect their current income generating activities. </p>
<p>The engagement group would provide both the government and the local communities with a forum in which to discuss these concerns. This would help the government develop a more accurate assessment of the risks and benefits of the project. In turn, this would enable it to make a more informed decision about whether to borrow the money. </p>
<p>It could also educate the civil society representatives about the rationale for the project. This would help the local communities and their supporters make more informed decisions about the project.</p>
<p>Another example is that one of the international financial institutions may be considering changing its policies on climate change, and need member state approval for the changes. The engagement group would provide a forum in which government can learn about the views of non-state actors. This would help the government make informed decisions. It would also help South African representatives advocate more persuasively for the government’s position at the institutions.</p>
<h2>Precedents</h2>
<p>Such engagement groups are not unprecedented. They exist in countries such as the US and the Netherlands. They operate informally and have not been written about. But in our engagements with individuals involved in them – or who have worked with them – we learnt that they have contributed to enhancing the efficacy of their country’s engagements with the institutions as well as promoting accountability and operational reforms.</p>
<p>There is no reason to think that a South African engagement group would be any less effective in enhancing the efficacy of the country’s engagement with these institutions. In fact, it would contribute to the president’s <a href="https://theconversation.com/south-africans-are-feeling-more-insecure-do-ramaphosas-plans-add-up-176991">stated aim</a> of forging a stronger bond between government and society so that they can all work to create a more just and equal society.</p><img src="https://counter.theconversation.com/content/177643/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Danny Bradlow SARCHI chair is funded by the National Research Foundation. His current research is funded by Oxfam SA and the Open Society Initiative of Southern Africa.</span></em></p>A liaison group with large financial institutions has worked in the US and the Netherlands.Danny Bradlow, SARCHI Professor of International Development Law and African Economic Relations, University of PretoriaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1008472018-08-01T14:37:36Z2018-08-01T14:37:36ZThe BRICS summit: important small steps, but little to show on big issues<figure><img src="https://images.theconversation.com/files/230234/original/file-20180801-136649-1o552eq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">EPA/Alexey Nikolsky</span></span></figcaption></figure><p>Trying to evaluate a meeting like the <a href="http://www.brics2018.org.za/">BRICS summit</a> that recently took place in Johannesburg is challenging. On the one hand, a summit is an exercise in political theatre. In this sense, success means that the leaders put on a good show of international camaraderie and issue a communique expressing their firm commitment to solving the common challenges facing their countries and the world.</p>
<p>On the other hand, an annual summit is the culmination of a year-long process of meetings of officials, politicians and non-state actors from the participating countries. They spend the year trying to reach agreement on specific deliverables that they hope their leaders will endorse in their communique, which is the summit’s primary output. </p>
<p>This means that understanding the real meaning of the communique is essential to assessing the success of the summit. This requires paying close attention to what the communique does – and doesn’t – say as well as to the things that it promises. </p>
<p>The Johannesburg BRICS summit delivered a mixed bag when judged on these two criteria. The communique makes clear that some solid work was done and that the participants have agreed to undertake some useful initiatives. But it’s also clear that on some issues the leaders resorted to vague statements that hide their real differences. This suggests that, despite their accomplishments, there are differences in their overall commitment to the BRICS. In addition, key countries view it as merely one option for advancing their grand international relations strategy. </p>
<h2>The positive notes</h2>
<p>The leaders issued a <a href="https://www.gov.za/speeches/brics-summit-johannesburg-declaration-27-jul-2018-0000">communique</a> that suggested that they had a productive meeting and agreed on a range of issues. </p>
<p>They announced the formation of a new vaccines research centre in South Africa and their intentions to collaborate more in tourism and customs, technology, energy, the environment and agriculture. </p>
<p>On trade, the leaders followed the <a href="http://www.ecns.cn/business/2018-07-28/detail-ifywnmyq4944105.shtml">Chinese lead.</a> They expressed their support for a rules based multilateral international trading system and called on all countries to comply with their World Trade Organisation (WTO) commitments. They also stated their support for the newly signed <a href="https://au.int/en/ti/cfta/about">African Continental Free Trade Agreement</a> and for the African Union’s <a href="https://au.int/en/agenda2063">Agenda 2063</a>. </p>
<p>They agreed on the importance of promoting a more inclusive and sustainable international society, stressing the importance of the Sustainable Development Goals. And the leaders commended the BRICS’ New Development Bank’s for discussing <a href="https://www.ndb.int/press_release/ndb-president-reports-brics-leaders-banks-progress-summit-johannesburg-south-africa/">innovative</a> approaches to development finance. </p>
<p>They also praised officials for the progress that’s been made in establishing a BRICS local currency bond fund. This will help the countries raise funds for development projects from each other and further develop their local capital markets. Progress also has been made in operationalising the <a href="https://theconversation.com/brics-needs-a-new-approach-if-its-going-to-foster-a-more-equitable-global-order-84229">Contingent Reserve Arrangement</a> which is designed to provide central bank support to a member state facing balance of payments problems. </p>
<p>They also announced more people-to-people exchanges in sports, culture and research collaborations.</p>
<p>The leaders called for South Africa, Brazil and India to play a larger role in the United Nations and for a larger voice for Africa in the governance of the International Monetary Fund (IMF).</p>
<h2>The gaps</h2>
<p>The summit communique had some noteworthy gaps. </p>
<p>First, while the leaders expressed support for IMF governance reform, they failed to explicitly support South Africa’s lobbying for a third chair for Africa on the IMF board of directors. They also didn’t propose any other specific measures to improve African participation in IMF governance. </p>
<p>Second, the communique failed to specifically support Brazil, India and South Africa’s efforts to win permanent seats on the UN Security Council. </p>
<p>The leaders highlighted their concerns about the challenges in the international trading system and called for it to become more inclusive and development oriented. But they didn’t set out how the system should be reformed to achieve these objectives. This is particularly striking because their meeting came soon after the US and the European Union announced that they could begin working together to <a href="https://globalnews.ca/video/4353039/trump-says-eu-and-u-s-will-work-to-reform-wto-resolve-steel-and-aluminum-tariffs">reform the WTO</a>. </p>
<p>Similarly, their expression of support for the AU’s free trade agreement and Agenda 2063 was devoid of any specific commitments. This is particularly noteworthy because both the Chinese and the Indian leaders combined their participation in the summit with <a href="https://www.firstpost.com/world/narendra-modi-arrives-in-rwanda-becomes-first-indian-prime-minister-to-visit-east-african-country-4802021.html">visits</a> to various African countries to whom they they made specific offers of support.</p>
<p>This suggests that India and China see the BRICS as only one channel for developing economic relations in Africa. It also means that South Africa’s position as the BRICS’ gateway to Africa is not assured.</p>
<h2>Financial intervention</h2>
<p>While the communique highlighted the progress made in operationalising the Contingent Reserve Arrangement, it gave no indication that the BRICS are planning to de-link the Contingent Reserve Arrangement from the IMF. This means that about 70% of the financing available through this initiative will be linked to reaching agreement with the IMF. This should be seen in the context of the BRICS lukewarm support for increased African representation in IMF governance </p>
<p>In addition, while the communique commends the BRICS Bank for considering innovative approaches to development finance, it makes no mention of its poor record when it comes to <a href="https://theconversation.com/brics-needs-a-new-approach-if-its-going-to-foster-a-more-equitable-global-order-84229">transparency</a>, participation and accountability. In fact, the bank is less transparent, less open to consultation and less accountable than any of the other multilateral development banks. </p>
<p>Without improvement in these areas it is hard to see how the New Development Bank can become an environmentally and socially responsible funder of sustainable and inclusive infrastructure. The bank’s lack of progress in the transparency scale exposes it to significant reputational risk.</p>
<h2>Hedging bets</h2>
<p>The BRICS have agreed some impressive initiatives and have taken some steps to strengthen their ties. But they have also failed to demonstrate that they will live up to their promise to be an effective advocate for global governance reform.</p>
<p>Key leaders have also shown that they are hedging their bets on the BRICS. They are using other vehicles to develop their international relations in Africa and at the global level. </p>
<p>The key takeaway therefore is that South Africa should be proud of its participation in the BRICS but should retain a healthy scepticism in its approach to the group. It should continue to diversity its international economic and political relations, should attach appropriate value to the BRICS and all the other regional and international forums and groupings in which it participates and South Africa should avoid over-investing in the BRICS.</p><img src="https://counter.theconversation.com/content/100847/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Danny Bradlow's chair is funded by the National Research Foundation. </span></em></p>The 10th BRICS Summit delivered a mixed bag when judged on what it said on key issues, like global governance and trade.Danny Bradlow, SARCHI Professor of International Development Law and African Economic Relations, University of PretoriaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1004702018-07-25T14:45:35Z2018-07-25T14:45:35ZAs global headwinds batter countries in BRICS, can it stay the course?<figure><img src="https://images.theconversation.com/files/229285/original/file-20180725-194124-1xuizb7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">China's President Xi Jinping and South Africa's President Cyril Ramaphosa are expected to push for stronger ties at the 10th BRICS Summit.</span> <span class="attribution"><span class="source">EPA/Phil Magakoe</span></span></figcaption></figure><p>The priorities and themes of the <a href="https://www.fin24.com/Economy/everything-you-need-to-know-about-the-brics2018-summit-in-sa-20180720">10th BRICS Summit</a>, ranging from peacekeeping to collaboration around the 4th Industrial Revolution, provide a number of issues that summit leaders say they want to pursue.</p>
<p>The summit in Johannesburg is the culmination of regular meetings held by the foreign ministers of Brazil, China, India and Russia since 2006. The BRICS political bloc was <a href="https://news.cgtn.com/news/3d3d674e3567444f78457a6333566d54/share.html">institutionalised</a> as a platform in Yekaterinburg, Russia, on 16 June 2009. South Africa officially joined in 2011.</p>
<p>Reconciling domestic interests and priorities with international obligations will remain a fundamental focus for this meeting. But perhaps the more critical question to ask is how the bloc is going to strengthen its role and agenda in an international order that is characterised by fragmentation and uncertainty. </p>
<p>Over the past 10 years, the BRICS partners have launched a number of initiatives aimed at providing additional and different capabilities to global, political, and economic governance structures. One of its projects has included creating the <a href="https://www.ndb.int/">New Development Bank</a>. So far the Bank has initiated funding to the value of <a href="https://www.ndb.int/president_desk/opening-address-president-k-v-kamath-third-annual-meeting-new-development-bank-shanghai-china/">US$3.4 billion</a> at the end of 2017 to member countries.</p>
<p>In addition, BRICS has created the <a href="https://www.ujuh.co.za/reserve-fund-is-low-lying-fruit-for-sixth-brics-summit/">Contingency Reserve Arrangement</a>, aimed at ensuring liquidity for member-states when they’re confronted by short term balance of payment crises.</p>
<p>With these institutions in place, the 10th summit provides the opportunity for the five countries to reflect on the bloc’s practical relevance and its future footprint.</p>
<p>Scepticism around the <a href="https://www.weforum.org/agenda/2017/10/brics-first-next-ten-years/">coherence</a> of BRICS as a functioning group persists. But it’s safe to bet that the five countries won’t regress in their obligations. To retreat now would be a colossal admission that the cynics were right all along. </p>
<p>The BRICS bloc will also want to assert its authority on the back of the growing uncertainties in global political affairs. Two of its members, China and Russia, are caught in the cross hairs of a <a href="https://www.bbc.com/news/world-us-canada-44434558">belligerent</a> US. This makes it a particularly important time to emphasise and <a href="https://www.fin24.com/Economy/brics-summit-no-talkshop-20180722-2">cement</a> the role of BRICS.</p>
<h2>What’s next for BRICS?</h2>
<p>BRICS should by no means be romanticised. It is, by its very nature, an imperfect construction given the size and scale of its member states. </p>
<p>Interesting new nuances are affecting the positioning of China, India, and Russia within the BRICS bloc. These include two factors: new alliances between the five countries, and China’s massive <a href="https://www.ebrd.com/what-we-do/belt-and-road/overview.html">Belt Road Initiative</a>, President Xi Jiping’s re-configuration of channels that connect China with Asia, Africa and Europe.</p>
<p>The BRICS bloc also comprises of sub-groupings that play a significant role in influencing internal loyalties and strategic interests within the group. There is <a href="https://www.globalsecurity.org/military/world/int/sco.htm">the Shanghai Cooperation Organisation</a> which was formed in 2001. It is seen as an intergovernmental organisation that deals with energy and security made up of China, Russia and six central Asian republics. It’s been characterised as the <a href="https://www.cnbc.com/2018/06/10/g7-versus-the-shanghai-cooperation-organisation-sco-summit.html">counter weight</a> to US influence in Central Asia. Other commentators are identifying it as the counter balance to the G7, a bloc made of the US, Germany, France, Italy, Canada, Japan and the UK.</p>
<p>Then there is the India, Brazil and South Africa <a href="https://www.wits.ac.za/news/sources/wsg-news/2018/ibsa-could-function-as-a-democratic-organisation-within-brics-itself.html">trilateral</a> cooperation bloc. This was established in 2003 as a South-South cooperation platform.</p>
<p>The <a href="https://www.rbth.com/world/2016/04/20/the-ric-core-of-brics-meets-in-moscow_586377">cooperation</a> between Russia, India and China has also become prominent. In April 2016, the foreign ministers of Russia, India and China met to further their cooperation around a global governance agenda. Similarly the relationship between <a href="http://www.china-briefing.com/news/2018/05/15/china-sign-free-trade-agreement-eurasian-economic-union-may-17.html">China and Russia</a> is strengthening. All of this will inform how BRICS develops from here on out.</p>
<p>The Belt Road Initiative has already sparked disagreement. In the run-up to the 9th BRICS Summit held in China, the Indian delegates attending the academic forum in Fuzhou were steadfastly <a href="https://www.thehindu.com/todays-paper/tp-international/india-objects-to-brics-supporting-chinas-bri/article19106324.ece">opposed</a> to</p>
<blockquote>
<p>docking the Beijing led Belt and Road Initiative with the grouping in the future. </p>
</blockquote>
<p>Another source of difference is around a possible extension of the BRICS membership base through the BRICS Plus concept. At the 2013 Durban Summit, South Africa initiated the <a href="http://www.brics2018.org.za/brics-outreach">BRICS Outreach Partnership</a>, a channel of inclusion for key partners across the African continent. </p>
<p>In 2017, China remodelled the BRICS outreach partnership into the <a href="https://www.weforum.org/agenda/2018/01/brics-plus-an-alternative-to-globalization-in-the-making">BRICS Plus</a> which has a more expansive outlook within a broad spectrum of actors from emerging markets and the developing world. The shift of the traditional outreach partnership into the BRICS Plus could be interpreted as testing the waters for the possible expansion of BRICS membership.</p>
<p>But India seems to be <a href="https://www.thehindu.com/todays-paper/tp-international/india-objects-to-brics-supporting-chinas-bri/article19106324.ece">uncomfortable</a> with the BRICS Plus concept, in particular a reconfiguration of the grouping stacked in favour of Beijing.</p>
<h2>A gap to lead</h2>
<p>While the collective identity of the BRICS bloc is still being tested, the prevailing cracks in the global system present opportunities for it to assert and strengthen its position. It can do so by upholding the principles of the liberal multilateral trading arrangements which the US seems to be dumping.</p>
<p>The significant question will be: how and to what extent will the BRICS take the next step in underwriting the rules of the game in an international order that is seeking leadership and direction?</p><img src="https://counter.theconversation.com/content/100470/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sanusha Naidu does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The BRICS bloc can’t be written off. At the same time it shouldn’t be romanticised, given its internal challenges.Sanusha Naidu, Senior Researcher, University of South AfricaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1004652018-07-24T15:36:36Z2018-07-24T15:36:36ZBRICS summit in Johannesburg: here’s what the five countries are looking for<p>All eyes are on Johannesburg for the <a href="http://www.brics2018.org.za">2018 BRICS summit</a>, as the likes of Vladimir Putin, Xi Jinping and Narendra Modi take their places at the table. It marks the tenth annual gathering for this international organisation of the leading emerging economies. So what can we expect?</p>
<p>The summit of the BRICS countries – Brazil, Russia, China, India and South Africa – started in June 2009 at Yekaterinburg, when Russia hosted the leaders of this bloc, though it did not originally include South Africa. BRIC became a formal institution the following year, aimed at facilitating global political and economic transformation, and South Africa officially joined in 2011. </p>
<p>Much has been written about this group’s threat to the Western-dominated world economic order. BRICS formed the <a href="https://www.ndb.int">New Development Bank</a> in 2014, the first major international development bank with no participation from the <a href="https://www.oecdwatch.org/oecd-guidelines/oecd">OECD countries</a>. The following year it established the <a href="https://economictimes.indiatimes.com/news/economy/policy/brics-contingent-reserve-arrangement-operational-arun-jaitley/articleshow/54741704.cms">BRICS Contingent Reserve Arrangement</a>, widely regarded as a rival to the International Monetary Fund. The bloc has also been trying to find new ways of engaging in international affairs by leading on key issues such as <a href="https://www.iol.co.za/business-report/brics/how-brics-is-dealing-with-climate-change-15553255">climate change</a>, <a href="https://iorj.hse.ru/data/2017/12/28/1160694810/A.E.%20Abdenur.pdf">regional security</a> and <a href="https://www.iol.co.za/news/politics/terror-cyber-crime-hot-topics-for-brics-15761373">anti-terrorism</a>. </p>
<p>By 2016, the BRICS bloc had 41% of the world’s population and just under 30% of the territory. The five countries control 23% of global GDP, worth about US$40.6 trillion (£30.9 trillion), and 18% of trade. The group is growing impressively if you take it as a single entity, <a href="http://pubdocs.worldbank.org/en/842861463605615468/Global-Economic-Prospects-June-2016-Divergences-and-risks.pdf">averaging</a> 3.8% in 2015, 4.2% in 2016 and 5.1% in 2017 – though China and India <a href="https://www.saiia.org.za/speeches-presentations-other-events-materials/1237-brics-media-brief-economics/file">are growing</a> much faster than the rest. Xi Jinping in 2017 <a href="https://www.telegraph.co.uk/news/world/china-watch/politics/brics-golden-decade/">referred</a> to the countries’ “golden decade”, though it does depend on who you are talking about. </p>
<h2>Trading insults</h2>
<p>The summit comes at a time when the West is <a href="https://www.nytimes.com/2016/10/20/opinion/the-decline-of-the-west-and-how-to-stop-it.html">arguably</a> in decline. We see the US threatening trade wars with most other countries, above all China, but also even allies like the EU. The threat to global trade <a href="https://uk.news.yahoo.com/trade-war-risk-dominate-brics-summit-africa-015514423.html">will be top</a> of the agenda at the BRICS summit – hardly surprising when China’s economic weight gives it such a powerful role within the bloc. Russian economy minister Maxim Oreshkin <a href="http://www.arabnews.pk/node/1344326/business-economy">said recently</a>:</p>
<blockquote>
<p>The summit is about the context … We are at a time when the US and China announce new measures almost every week.</p>
</blockquote>
<p>Johannesburg will see much emphasis on consolidating members’ trade relations through the likes of reduced tariffs. This might boost trade between the countries, which has been <a href="https://www.saiia.org.za/speeches-presentations-other-events-materials/1237-brics-media-brief-economics/file">stagnant</a> or <a href="https://www.exportgenius.in/blog/trade-relations-among-brics-countries-intrabrics-trade-statistics-161.php">declining</a> in <a href="https://www.dailyo.in/politics/brics-goa-china-pakistan-russia-unsc-nsg-cpec-masood-azhar/story/1/13347.html">recent years</a>. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=249&fit=crop&dpr=1 600w, https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=249&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=249&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=313&fit=crop&dpr=1 754w, https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=313&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/229052/original/file-20180724-194152-1v9umh6.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=313&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Trade is in US$ billions.</span>
<span class="attribution"><a class="source" href="https://www.saiia.org.za/speeches-presentations-other-events-materials/1237-brics-media-brief-economics/file">SAIIA</a></span>
</figcaption>
</figure>
<p>Africa and sustainable development will also receive much attention this year. Despite the heavyweight delegates list, South African leader Cyril Ramaphosa will no doubt do his best to steal everyone’s thunder both as host and debutante president. His country’s economy <a href="https://www.ft.com/content/06022992-68ad-11e8-b6eb-4acfcfb08c11">has been shrinking</a>, with <a href="https://www.bloomberg.com/news/articles/2018-06-05/south-africa-economy-contracts-in-first-quarter-as-mines-decline">sectors such as</a> mining and farming in the doldrums, made worse by corruption problems that came to symbolise his predecessor Jacob Zuma’s administration. </p>
<p>Ramaphosa will be hoping to secure extra investment and trade agreements from his counterparts. The leaders of other African countries and institutions are also attending the summit as part of BRICS’ ongoing <a href="http://www.brics2018.org.za/brics-outreach">outreach programme</a>, following tours of the region both by Modi and Xi. These representatives will be particularly interested in the progress of China’s <a href="https://theconversation.com/central-asia-is-the-new-economic-battleground-for-the-us-china-and-russia-98263">Belt and Road Initiative</a> to reduce barriers across Asia, perhaps in the hope that it could one day involve them, too.</p>
<p>Meanwhile, the Brazilian delegation will be looking for new forms of co-operation that can benefit their <a href="https://www.ft.com/content/f3d2cd90-1e46-11e8-aaca-4574d7dabfb6">tenuous economy</a>, which is <a href="https://www.reuters.com/article/us-brazil-agriculture-trade/u-s-china-trade-war-could-hit-brazil-in-the-long-run-minister-idUSKCN1IP39P">threatened</a> by various knock-on effects from the American trade and currency war – with China its main trading partner. Brazil also stands in the shadow of <a href="https://wolfstreet.com/2018/05/12/whos-most-afraid-of-a-latin-american-debt-crisis-apart-from-latin-america/">debt problems</a> that are troubling much of Latin America. Expect to see President Michel Temer seeking more financial support from the New Development Bank, though his bigger goal should be deepening trade relations that will help his country’s balance of payments in the longer term. </p>
<h2>The Putin embrace</h2>
<p>We are perhaps not expecting President Putin to provide significant economic leverage to other members, but Russia’s substantial political influence will be his main card to play at the summit. At a time when Russia is on the verge of being a pariah to some countries, <a href="https://www.telegraph.co.uk/news/2018/03/14/relations-britain-russia-now-dangerous-cold-war-warns-putins/">not least</a> the UK, it will suit Putin to demonstrate warm relations with his fellow BRICS members. </p>
<p>Following Putin’s recent <a href="https://theconversation.com/how-vladimir-putin-outfoxed-donald-trump-at-helsinki-before-their-meeting-even-began-99320">bilateral talks</a> with Donald Trump, the summit is a chance for Russia to enhance its global position and undermine Western containment, particularly the economic sanctions imposed after the <a href="https://www.nato.int/docu/review/2015/russia/sanctions-after-crimea-have-they-worked/EN/index.htm">Crimean crisis</a> in 2014. The ever closer ties between Russia and China will presumably be a theme, after China’s foreign minister recently <a href="https://edition.cnn.com/2018/04/06/asia/russia-china-relations-us-intl/index.html">described</a> them as being at “their best level in history”. </p>
<p>As for India, the role it plays at the summit will be very interesting. On the one hand, Modi will be seeking new deals for his country, the second largest economy in the bloc after China. On the other hand, India is playing a <a href="https://www.dailyo.in/politics/india-china-ties-narendra-modi-xi-jinping-doklam-obor-unified-korea-us-pakistan-nsg-masood-azhar/story/1/23805.html">delicate geopolitical game</a> with the US, China and Russia as their spheres of influence wax and wane across Asia and the Middle East. Show excessive favour to one side and there is the potential for ramifications across the region. </p>
<p>In all, the summit is a useful opportunity for these countries to remind the world of what multilateralism can achieve, and chart new strategies for the coming decade. We may not see any significant leap forward as discussions get underway, but we’ll certainly see the emerging powers attempting to loud-speak their influence at a time of growing protectionism and uncertainty. This bloc has yet to create anything resembling a new world order, but the celebrations from the global south in Johannesburg will certainly reverberate around the world.</p><img src="https://counter.theconversation.com/content/100465/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Xuebing Cao does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>With international trade facing its greatest threat in decades, this club of China, Brazil, Russia, South Africa and India will have much to say about it.Xuebing Cao, Lecturer in Industrial Relations, Keele UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/842292017-09-20T14:17:17Z2017-09-20T14:17:17ZBRICS needs a new approach if it’s going to foster a more equitable global order<figure><img src="https://images.theconversation.com/files/186830/original/file-20170920-16391-6hkn42.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Brazilian President Temer, Russian President Putin, Chinese President Xi Jinping, South Africa's President Zuma and Indian Prime Minister Modi.
</span> <span class="attribution"><span class="source">Reuters/Kenzaburo Fukuhara</span></span></figcaption></figure><p>The formation of the <a href="http://economictimes.indiatimes.com/articles/brics-and-the-new-emerging-economic-order/brics_show/53946132.cms">BRICS</a> – the bloc made of Brazil, Russia, India, China and South Africa – was supposed to be the harbinger for a new approach to global economic governance. The leading emerging markets and developing countries were becoming major players in the global economy. And they expected to play a commensurate governance role. </p>
<p>BRICS leaders have now been meeting annually for nine years. They recently met for the <a href="https://brics2017.org/English/">ninth BRICS Summit</a> in Xiamen, China. They have positioned themselves as a force for <a href="https://brics2017.org/English/Documents/Summit/201709/t20170908_2021.html">transforming</a> global economic governance so that it’s more responsive to the concerns of developing economies. They are seeking a more just and equitable global economy. </p>
<p>The question is: how effective have they been in reforming global economic governance and the fairness of the global economy? </p>
<p>The honest answer is that as a group, BRICS hasn’t been an effective force at all. This is for a number of reasons.</p>
<h2>What’s not happened</h2>
<p>The following examples illustrate the point. </p>
<p>At least formally the G20, which consists of 20 major economies including the five in BRICs, has supplanted the G7, made up of Canada, France, Germany, Italy, Japan, the UK and the US, as the premier forum for global economic governance. But the agenda in these meetings is still largely set by the most powerful countries which now include China but not the other BRICS. </p>
<p>The IMF and World Bank have both changed their voting arrangements to give a louder voice to developing economies and emerging economies. This has particularly benefited China, India and Brazil. But BRICS hasn’t supported South Africa’s call for a third African seat on the board of the IMF. This has left Africa as the most underrepresented region on the board.</p>
<p>BRICS countries, together with other G20 developing countries, have become more active participants in organisations responsible for developing international financial regulatory standards. This means that they now can participate in the writing of standards that guide the international financial system. But the system continues to be more responsive to the interests of the rich and powerful than those of the developing world. </p>
<p><a href="http://www.saiia.org.za/opinion-analysis/the-brics-new-development-bank-and-contingent-reserve-arrangement-at-a-glance">New international financial institutions</a> have been created, including the BRICS’ New Development Bank and the Contingent Reserve Arrangement, which provides financial support for BRICS countries experiencing balance of payments problems. Unfortunately, the New Development Bank operates in a less transparent and less accountable way than other multilateral development banks. For example, it’s harder for outsiders to access information on the operational policies and practices of the bank than those of the World Bank or the African Development Bank. Unlike those other banks, there isn’t yet a mechanism to hold the New Development Bank accountable if it causes harm. </p>
<p>The New Development Bank also risks repeating the tragic mistakes of these other institutions, which for many years concentrated only on economic issues in their operational decision making. Following a number of scandals they began to pay more attention to the social, human rights and environmental impact of their operations.</p>
<p>Members of the New Development Bank seem to share this concern. The BRICS leaders have reiterated their commitment to achieving</p>
<blockquote>
<p>sustainable development in its three dimensions - economic, social and environmental- in a balanced and integrated manner.</p>
</blockquote>
<p>But it’s hard to see how they expect the bank to meet this commitment if it continues to place more emphasis on speed in project implementation than on identifying and managing the adverse environmental, human rights and social effects of its projects. To fulfil their commitment to promote a more just and equitable global economy the BRICS will need to up their game. </p>
<h2>How to fix the problem</h2>
<p>Achieving a just and equitable international economic order requires governments to take seriously their commitment to protect and promote human rights as set out in the UN Charter and other human rights treaties. </p>
<p>The starting point is a commitment to respect and promote the rights of each individual affected by each project, programme or policy that governments undertake or support. This requires developing a good system to forecast the impact of a project on the environment, society as well as human rights. And to have a plan to manage them.</p>
<p>Another element is accountability. Any person adversely affected by a project should have access to a mechanism that can provide them with an effective remedy. </p>
<p>Finally, the relevant decision makers must be able to show how their proposed activity is using the maximum available human and financial resources to fulfil the human rights of all the people affected by their decisions. This suggests that the relevant decision makers bear the burden of explaining why the proposed allocations are the most feasible. This includes governments, international organisations as well as private parties. </p>
<p>There are reasons to think the BRICS leaders could be persuaded to adopt a human rights based approach to making global economic governance more democratic and responsive to the needs of developing countries and for a more just, equitable and sustainable global economy. They, and their colleagues in other developing countries, are governing societies with continuing, and some cases worsening poverty, inequality, unemployment and environmental degradation levels. And they don’t seem to have an effective strategy for meeting this challenge.</p><img src="https://counter.theconversation.com/content/84229/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Danny Bradlow receives funding from the National Research Foundation, which funds his SARCHI chair. </span></em></p>The promise of BRICS was that it would usher in a new approach to development. But after meeting annually for the last nine years there’s no sign that the old order has been challenged.Danny Bradlow, SARCHI Professor of International Development Law and African Economic Relations, University of PretoriaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/820272017-08-08T19:43:45Z2017-08-08T19:43:45ZWhy South Africa shouldn’t turn to the IMF for help<figure><img src="https://images.theconversation.com/files/181015/original/file-20170804-2386-ro9o9n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Two men sit at the roadside in the hope of being offered work. South Africa's unemployment is moving towards 30%.</span> <span class="attribution"><span class="source"> EPA/NIC BOTHMA</span></span></figcaption></figure><p>The view that South Africa should look towards the International Monetary Fund (IMF) to be rescued from the unfolding economic meltdown seems to be <a href="https://theconversation.com/south-africa-should-consider-help-from-the-imf-to-fix-its-economy-81701">growing by the day</a>. It has been touted in the most unlikeliest of places. Even the new Finance Minister Malusi Gigaba, a proponent of the so-called <a href="http://www.fin24.com/Economy/mps-grill-gigaba-on-radical-economic-transformation-20170509">radical economic transformation</a>, has expressed willingness to <a href="https://www.timeslive.co.za/sunday-times/business/2017-06-30-gigaba-may-need-to-seek-outside-help-to-get-economy-going/">engage the IMF</a>.</p>
<p>There is no doubt about the seriousness of South Africa’s economic crisis. The country entered a technical recession after the economy contracted in the fourth quarter of last year and <a href="https://theconversation.com/south-africas-in-a-recession-heres-what-that-means-78953">first quarter of this year</a>. Unemployment seems to be rising towards <a href="https://tradingeconomics.com/south-africa/unemployment-rate">the 30% mark</a>. </p>
<p>And global credit rating agencies are uneasy about South Africa’s economic prospects. After a spate of <a href="https://www.thesouthafrican.com/moodys-downgrades-south-africa-to-one-notch-above-junk/">downgrades early this year</a>, they have <a href="https://businesstech.co.za/news/banking/189281/sa-central-bank-under-increasing-political-pressure-moodys/">threatened further downgrades</a> which will take the country deeper into junk status.</p>
<p>While the South African situation is getting more desperate, which calls for desperate measures, the idea to turn to the IMF is a bad idea and must be dismissed. There are a number of reasons why I think this is the case.</p>
<p>First, historical evidence suggests that IMF administered rescue programmes are actually a <a href="https://www.cato.org/publications/speeches/why-imf-should-not-intervene">recipe for disaster</a>. They worsen rather than rescue the situation.</p>
<p>Second, to suggest that South Africa’s problems are financial in nature is a <a href="https://theconversation.com/how-corruption-is-fraying-south-africas-social-and-economic-fabric-80690">dangerous misdiagnosis</a>. It will distract the government from <a href="http://mobius.blog.franklintempleton.com/2017/03/16/south-africa-key-issues-and-challenges/">the critical issues</a> it needs to address which have little to do with the finances. </p>
<p>Third, one of the main driving factors of the current economic predicament is a loss of investor confidence. This is linked to other factors like policy uncertainty, political instability within the ruling party and mismanagement of public resources mixed with corruption. An IMF bailout won’t address these problems.</p>
<p>And lastly, hopping onto the IMF programme would disturb the country’s commitment to reforming the global multilateral financial world. South Africa is part of the BRICS bloc which is grooming a new and perhaps alternative multilateral development finance institution called <a href="https://theconversation.com/the-brics-plan-for-a-new-world-order-begins-with-a-bank-29251">New Development Bank</a>. If anything, South Africa must look to BRICS if it needs financial rescue. </p>
<p>I believe that the solutions to the country’s economic crisis are within. It needs internal discipline to address them – not an external force.</p>
<h2>Bad record</h2>
<p>The IMF does not have a good historical record. A view of the many countries which have subjected themselves to the IMF doesn’t inspire confidence. Instead of bailing out countries, it has created a list of countries suffering from debt dependency.</p>
<p>Of all the countries across the world that have been <a href="http://www.zerohedge.com/news/2013-07-06/41-imf-bailouts-and-counting-%E2%80%93-how-long-entire-system-collapses">bailed out by the IMF</a>:</p>
<ul>
<li><p>11 have gone on to <a href="https://www.cato.org/publications/congressional-testimony/international-monetary-fund-challenges-contradictions">rely on IMF aid</a> for at least 30 years </p></li>
<li><p>32 countries had been borrowers for <a href="https://www.cato.org/publications/congressional-testimony/international-monetary-fund-challenges-contradictions">between 20 and 29 years</a>, and </p></li>
<li><p>41 countries have been using IMF credit for <a href="https://www.cato.org/publications/congressional-testimony/international-monetary-fund-challenges-contradictions">between 10 and 19 years</a>. </p></li>
</ul>
<p>This shows that it’s nearly impossible to wean an economy from the IMF debt programmes. Debt dependency undermines a country’s sovereignty and integrity of domestic policy formulation. The debt conditions usually restrict pro-growth economic policies making it difficult for countries to come out of recession.</p>
<p>IMF’s poor record is partly influenced by the policy choices that it imposes on countries it funds. The IMF policy choices for developing countries, known as a <a href="http://www.whirledbank.org/development/sap.html">structural adjustment programme</a>, have been <a href="http://www.e-ir.info/2015/03/01/conditional-development-ghana-crippled-by-structural-adjustment-programmes/">widely condemned</a>. The main reason is that they insist on austerity measures which include; cutting government borrowing and spending, lowering taxes and import tariffs, raising interest rates and allowing failing firms to go bankrupt. These are normally accompanied by a call to privatise state owned enterprises and to deregulate key industries. </p>
<p>These austerity measures would cause great suffering, poorer standards of living, higher unemployment as well as corporate failures. The current technical recession would be magnified into a full-blown crisis, leading to even greater shrinking of investment. </p>
<h2>South Africa and the IMF</h2>
<p>South Africa has always been aware of the dangers of taking IMF money. In December 1993, five months before the country became a democracy, the National Party government, under the guise of transitional executive committee, signed an <a href="http://www.news24.com/elections/opinionandanalysis/how-mandelas-anc-sold-out-the-economic-struggle-20140422">IMF loan agreement</a>. </p>
<p>When the African National Congress (ANC) came to power after the elections in April 1994 it walked away <a href="http://www.news24.com/elections/opinionandanalysis/how-mandelas-anc-sold-out-the-economic-struggle-20140422">from the IMF offer</a>. Its concern was mainly that the IMF would undermine the sovereignty of the newly established democracy by imposing inappropriate, policy choices that would have further <a href="https://www.nelsonmandela.org/omalley/index.php/site/q/03lv01508/04lv01530/05lv01531.htm">harmed poor people</a>.</p>
<p>Over the past 23 years South Africa has stayed away from the IMF. There is no reason to change this. In fact there are more reasons today for South Africa to maintain its position.</p>
<h2>The BRICS factor</h2>
<p>South Africa is set to assume the rotational chair of the BRICS bloc in 2018. The BRICS bloc was formed, in part, to challenge, the dominance of western Bretton Woods institutions – the IMF and the World Bank. </p>
<p>It would be politically naive and economically counterproductive for South Africa to give itself to the IMF. It would undermine South Africa’s integrity and tarnish its place within the BRICS bloc. And it would undermine the idea that the BRICS’ New Development Bank can offer an alternative to the Bretton Woods institutions.</p>
<p>BRICS promises to yield real economic benefits to South Africa because it can leverage trade between the member countries as well as public and private investment from within the bloc. </p>
<h2>A better way to deal with the crisis</h2>
<p>Advancing any financial assistance to South Africa without addressing the current bad policies would not address the current economic turmoil. Rather, it would result in the country sliding deeper into debt.</p>
<p>And any assistance would be entrusted to a government that has created the crisis because of imprudent policies. The result would be an extension of the crisis because the pressure would have been taken off the government leaving the architecture of the meltdown intact. </p>
<p>What needs to happen is that policymakers need to turn their minds to the real problems. This can simply be done without a bailout.</p><img src="https://counter.theconversation.com/content/82027/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Misheck Mutize does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The idea that South Africa must look towards the International Monetary Fund to rescue itself from the prevailing crisis must be dismissed.Misheck Mutize, Lecturer of Finance and Doctor of Philosophy Candidate, Graduate School of Business (GSB), University of Cape TownLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/672022016-10-18T07:41:04Z2016-10-18T07:41:04ZWhy the BRICS coalition still matters<p>For years, Western newspapers have depicted the BRICS grouping – comprising Brazil, Russia, India, China and South Africa – as either <a href="https://www.ft.com/content/352e96e8-15f2-11e1-a691-00144feabdc0">nonsensical or threatening</a>. Indeed, after Brazil and Russia entered recession and growth in China slowed in recent years, <a href="https://www.washingtonpost.com/posteverything/wp/2015/11/10/the-rise-and-fall-of-the-brics/?utm_term=.83192019f42b">Washington-based observers</a> predicted the initiative’s imminent demise.</p>
<p>Well, they’re wrong. This past weekend, national leaders gathered in Goa for the <a href="http://brics2016.gov.in/content/innerpage/8th-summit.php">8th BRICS Summit</a>, showing that BRICS countries have not only continue to exist as a bloc but are, in fact, strengthening their cooperation.</p>
<h2>Towards stronger cooperation</h2>
<p>The group has begun to institutionalise, holding regular ministerial meetings in areas such as education, health and national security. And there are frequent encounters between BRICS presidents and foreign ministers. </p>
<p>Perhaps most notable is the creation of the BRICS-led <a href="http://ndb.int/">New Development Bank</a>, headquartered in Shanghai, and the contingent <a href="http://brics.itamaraty.gov.br/media2/press-releases/220-treaty-for-the-establishment-of-a-brics-contingent-reserve-arrangement-fortaleza-july-15">reserve agreement</a>, which creates a safety net for times of financial crisis. It will automatically provide liquidity for any member country facing financial distress.</p>
<p>Some had suggested that the political shift in Brazil – from the centre-left Workers’ Party to the centre-right administration of Michel Temer, <a href="https://www.theguardian.com/world/2016/aug/31/dilma-rousseff-impeached-president-brazilian-senate-michel-temer">following the impeachment Dilma Rousseff</a> – would reduce the country’s commitment to the BRICS coalition. But Temer has spoken of the grouping in <a href="http://www.bbc.com/portuguese/brasil-37667750">favourable terms</a>, and travelled to Asia twice in the first months of his mandate. </p>
<p>Putting political differences aside, the BRICS bloc is joining together to work on policy. During the recent meeting in Goa, leaders decided to move ahead with the creation of a BRICS-led <a href="http://indianexpress.com/article/india/india-news-india/brics-agree-to-set-up-credit-rating-agency-3086703/">rating agency</a>, based on the notion that the existing institutions – Moody’s, Standard and Poor’s and Fitch – unfairly favour Western countries and companies.</p>
<h2>Why BRICS will live on</h2>
<p>There are four key aspects to keep in mind when considering the future of the BRICS coalition.</p>
<p>First, while lower growth in China currently dominates headlines, it would be a mistake to believe that the global shift to emerging powers was temporary. As Jim O'Neill, who coined the term BRIC back in 2001 (South Africa was added in 2010), recently <a href="https://www.project-syndicate.org/commentary/enduring-importance-of-brics-by-jim-o-neill-2016-10">pointed out</a>:</p>
<blockquote>
<p>The suggestion that the BRICS’ importance was overstated is simply naïve. The size of the original four BRICs economies, taken together, is roughly consistent with the projections I made all those years ago.</p>
</blockquote>
<p>Second, the BRICS grouping is producing significant benefits for its members by creating an important platform for policymakers. In areas such as urban planning, anti-terrorism measures, water management, coordination of policy positions and higher education, the countries face common challenges – but previously had few channels of communication with each other. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=390&fit=crop&dpr=1 600w, https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=390&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=390&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=491&fit=crop&dpr=1 754w, https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=491&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/142044/original/image-20161017-12440-fph5hd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=491&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Jim O'Neill is confident that his projection for the countries still holds.</span>
<span class="attribution"><a class="source" href="http://pictures.reuters.com/Doc/RTR/Media/TR3/d/d/2/d/RTSP3FX.jpg">Pilar Olivares/Reuters</a></span>
</figcaption>
</figure>
<p>Today, experts can regularly consult each other via <a href="http://www.postwesternworld.com/2016/09/04/brics-leader-hangzhou/88">working groups</a>, and the New Development Bank helps coordinate debates about <a href="http://www.postwesternworld.com/2015/07/25/grouping-launches-development/">best practices in development</a>.</p>
<p>The group can also be seen as the first step to connect previously distant countries. While in decades past, the BRICS countries rarely coordinated their actions in multilateral fora, such as the United Nations or the International Monetary Fund, they now regularly discuss each positions prior to voting. </p>
<p>Considering how limited relations between, say, Brazil and India have been historically, the significance of such coordinated action should not be overlooked.</p>
<p>Third, Western international leadership is so deeply rooted and ubiquitous that people think of it as somehow natural. And this limits citizens’ capacity to objectively assess the consequences of its decline. The fact is, in the future, non-Western powers will continue to take on greater responsibilities – and they’ll do so without their Western peers. </p>
<p><a href="https://www.brookings.edu/research/why-is-china-investing-in-africa-evidence-from-the-firm-level/">Chinese investment in Africa</a> and Latin America, <a href="http://www.hindustantimes.com/world/pakistan-very-concerned-at-india-s-military-modernisation/story-JOrnmwTnk8B6CJ3vfrGhnJ.html">India’s growing military capacity</a> and Brazil’s attempt to <a href="http://www.nytimes.com/2010/05/17/world/middleeast/17iran.html?_r=0">negotiate an Iran nuclear deal</a> under former president Luiz Inácio Lula da Silva are all examples of this new multipolar reality.</p>
<p>The BRICS bloc did not emerge because China, India and others sought to overthrow existing order. On the contrary, they are firmly committed to institutions such as the UN. But there is a strong feeling in Beijing, Delhi and Brasília that existing institutions have failed to adapt to a new global context and have been unwilling to provide emerging actors with greater space and power. </p>
<p>For instance, despite years of promises about making the leadership selection process of international institutions more meritocratic, the head of the World Bank remains an American citizen, and the IMF is still lead by a European.</p>
<p>The differences and disagreements between the BRICS countries are real. Brazil, India and South Africa are democracies, while China and Russia have authoritarian leaders. Brazil and Russia export commodities, while China imports them. Brazil and India would like to join the UN Security Council as permanent members, but China and Russia are reluctant to support them. </p>
<h2>Surmountable obstacles</h2>
<p>But it would be naïve to believe that these differences preclude meaningful cooperation. Consider Europe: Italian policymakers oppose Germany’s ambitions to become a permanent member of the UN Security Council, but both countries still cooperate on a range of issues. And Turkey was a key NATO member even when it was non-democratic. </p>
<p>Indeed, tensions between BRICS members can even enhance the value of yearly summits, which provides a platform for problem-solving. </p>
<p>As one Russian government advisor privately pointed out before the Goa meeting:</p>
<blockquote>
<p>If ten years from now the only thing the BRICS Summits have achieved is to reduce the risk of future conflict between India and China, it will have been a great success.</p>
</blockquote>
<p>For Brazil and South Africa, the summits provide unique access to leading policymakers and bureaucrats in Moscow, Delhi and Beijing, which has the potential for ample benefits in the coming years as power continues to shift towards Asia.</p>
<p>All of this is to say that the BRICS coalition is here to stay. The transition to genuine multipolarity - of developing nations collaborating to have not just global economic impact but also military and agenda-setting capacity - will be disconcerting to Western powers. </p>
<p>But a world with BRICS leadership may, in the end, be more democratic than any previous world order. Allowing greater levels of genuine dialogue and a broader spread of knowledge, this will help us find more innovative and effective ways to address global challenges.</p><img src="https://counter.theconversation.com/content/67202/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Oliver Stuenkel does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Despite financial crises and political differences among these five emerging economies, the BRICS coalition is here to stay. And it may just change the world.Oliver Stuenkel, Assistant Professor of International Relations, Fundação Getulio VargasLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/450172015-08-13T04:57:49Z2015-08-13T04:57:49ZWhy south-south co-operation is a myth when it comes to BRICS and Africa<figure><img src="https://images.theconversation.com/files/91634/original/image-20150812-18104-l6x9e.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">What the increased ties between Russia, India, China and Brazil mean for Africa remains unclear.</span> <span class="attribution"><span class="source">Reuters/Sergei Karpukhin</span></span></figcaption></figure><p>Brazil, Russia, India and China have shown tremendous determination and co-operation on global issues in recent years. Their alliance epitomises south-south co-operation in the contemporary era. This is the notion of solidarity among developing countries through the exchange of goods, resources, technology and knowledge to meet their <a href="http://ssc.undp.org/content/ssc/about/what_is_ssc.html">development goals</a>.</p>
<p>But what does this all mean for Africa? Is this bloc of countries committed to Africa or simply driven by self-interest? For the purposes of this article I refer to the bloc known as <a href="http://www.economist.com/blogs/economist-explains/2013/03/economist-explains-why-south-africa-brics">BRICS</a> but I am excluding South Africa. The reason for this is that <a href="https://books.google.co.za/books?id=yXdaBQAAQBAJ&pg=PA59&dq=Bric,+Africa,+self+interest&hl=en&sa=X&ved=0CCQQ6AEwAGoVChMIwq7J0OSjxwIVxtYUCh0uFAOe#v=onepage&q=Bric%2C%20Africa%2C%20self%20interest&f=false">South Africa</a> was a late addition to the group and was brought in to complete the regional representativity of the group.</p>
<h2>New formidable bloc in global affairs</h2>
<p>Recent developments in south-south co-operation include increased trade volumes and foreign direct investments among <a href="http://www.unido.org//fileadmin/user_media/Publications/Research_and_statistics/Branch_publications/Research_and_Policy/Files/Working_Papers/2009/WP%2002%20South-South%20Cooperation.pdf">BRICS countries</a>. They also include <a href="http://www.un.org/en/conf/ldc/pdf/background%20paper%20on%20south-south%20cooperation%20for%20ldcs%20development-final.pdf">movements</a> towards regional integration, technology transfers, the sharing of expertise, and other forms of exchanges between developing and less developed economies. </p>
<p>This is particularly true for the economies of Brazil, Russia, India and China, which have increased their <a href="https://books.google.co.za/books?id=SBGgAgAAQBAJ&pg=PA222&dq=Brics,+terrorism&hl=en&sa=X&ved=0CDwQ6AEwBGoVChMIsYCI1uajxwIVogXbCh3GeADM#v=onepage&q=Brics%2C%20terrorism&f=false">co-operation</a> on global economic issues, global governance, geopolitics, development, aid, climate change, terrorism and a host of other issues.</p>
<p>Some observers remain cautious about the grouping and point to the <a href="http://globalinterests.org/wp-content/uploads/2015/07/Aleksashenko_BRICS_July-2015.pdf">limits</a> of its role in global affairs. Nevertheless, its member countries have become a force to reckon with. For example, the bloc has formalised the <a href="http://ndbbrics.org/">New Development Bank</a> and signed a <a href="http://www.saiia.org.za/doc_view/752-policy-insights-10-the-brics-contingent-reserve-arrangement-and-its-position-in-the-emerging-global-financial-architecture">Contingency Reserve Arrangement</a> at this year’s BRICS <a href="https://www.rt.com/business/273013-brics-summit-wrap-up/">summit</a> in Russia. </p>
<p>Discussions are also underway to establish their own credit ratings agency, bilateral swaps and settling trade in local currencies. At the summit, the bloc also discussed discarding the US dollar and the euro for their roughly US$500 billion trade with <a href="http://thebricspost.com/ufa-world-leaders-stress-global-governance-reforms/#.Vcr-ynGqpHw">one another</a>.</p>
<p>The bloc constantly raises its voice on the issues of global governance, particularly <a href="http://www.moderndiplomacy.eu/index.php?option=com_k2&view=item&id=484:the-un-security-council-reform-no-tricks-from-the-brics&Itemid=724">reforms</a> of the IMF and the UN Security Council. BRICS’s declaration at this year’s summit emphasised principles of openness, solidarity, equality, mutually beneficial co-operation and inclusiveness. These are thought to address emerging global economic, political and social <a href="http://en.brics2015.ru/documents/">challenges</a>.</p>
<h2>The impact on Africa</h2>
<p>While this all sounds very good, what is surprising is how little the <a href="http://en.brics2015.ru/documents/">summit</a> and the declaration had to offer African development. This is despite Africa, with a combined economy of <a href="http://data.worldbank.org/region/SSA">US$2 trillion</a>, having become central to the growth and development of Brazil, Russia, India and China in the 21st century. This is particularly so after the 2008 global financial crisis. </p>
<p>The strategy of these countries towards African development seems to be muddled with selfish national interests. The focus of all of them is on areas critical to the growth of their economies. These include fuel, minerals, biofuels, food and information and communication technology.</p>
<p>It is true that their engagement in Africa is <a href="http://zedbooks.co.uk/node/20386">reshaping the nature</a> of globalisation on the continent. It is also affecting the prospects for African development. Trade between China and Africa, for example, has grown dramatically. China is Africa’s biggest trading partner at about <a href="http://www.ft.com/cms/s/0/e05c6154-a90b-11e3-9b71-00144feab7de.html#axzz3icBxPFDI">US$200 billion</a> in 2013. It is followed by India. Its trade with Africa stood at <a href="http://www.bulletinofgeography.umk.pl/26_2014/03_Anwar.html">US$70 billion</a> in 2012 and is <a href="http://www.lse.ac.uk/IDEAS/publications/reports/pdf/SR016/SR-016-Large.pdf">projected</a> to rise to US$90 billion by the end of 2015.</p>
<p>Africa’s rapid economic growth in the past decade has led observers to chant <a href="http://www.economist.com/news/special-report/21572377-african-lives-have-already-greatly-improved-over-past-decade-says-oliver-august">“Africa Rising”</a>. But Africa’s over-hyped growth is driven by investments in the extraction of natural resources such as fossil fuels, minerals, biofuels and lately <a href="https://theconversation.com/the-lesser-known-story-of-indias-role-in-ethiopian-land-deals-42432">land acquisition</a>. Brazil, Russia, China and India have become important sources of foreign direct investments in these sectors. </p>
<p>There is little evidence that this engagement is helping address issues critical to the continent. Chief among these would be <a href="http://povertydata.worldbank.org/poverty/region/SSA">poverty reduction</a>, food security, climate change and medicine.</p>
<h2>Developmental or self-interest?</h2>
<p>Brazil, Russia, India and China’s engagements in Africa are largely driven by their domestic political economies. These in turn <a href="http://www.theguardian.com/global-development/2013/sep/12/brics-africa-global-order">influence the nature</a> of their investments in Africa and development assistance on the continent. </p>
<p>Their leaders are wont to claim that much of their trade and investment projects are “developmental”. Several Indian government officials I spoke to emphasised their engagements with Africa are not about imperialism and colonialism but “market-based” and “developmental”. But most of its <a href="https://theconversation.com/the-lesser-known-story-of-indias-role-in-ethiopian-land-deals-42432">investment and trade</a> in Africa resemble the relations Britain had with India during colonial times, which is extractive in nature and is true for other BRIC countries trading with Africa.</p>
<p>Given this, it is hard to see how the emergence of a rhetorically new development model based on south-south co-operation between Brazil, Russia and India and China is going to contribute to Africa’s development.</p>
<h2>Shifting the balance of power</h2>
<p>There are some aspects of the various engagements, such as India’s lines of credit to some African countries, that have developmental characteristics. These are considered less exploitative in comparison to aid from Western donors. </p>
<p>As “emerging donors”, the countries bring <a href="http://zedbooks.co.uk/node/20907">virtues of solidarity</a>, shared experience of colonial exploitation and empathy with developing countries. These are all key components of south-south co-operation. </p>
<p>The most important outcome of the emergence of Brazil, Russia, India and China is the shift they have brought to the balance of power in global affairs. The establishment of the new bank and the contingency reserve arrangement show that the old established US-dominated order is being challenged, and that formidable rivals have emerged. </p>
<p>Yet, the bloc wants to work within the framework of same Western institutions that are largely responsible for under-development in many parts of the world.</p>
<p>In this context, the potential of south-south co-operation for African development remains less clear. There is no coherent strategy from the group for helping develop Africa. A new way has to be found to ground the engagement on mutual benefit. As it stands, the bloc is pushing for a fair deal in global geopolitics for itself to the exclusion of Africa and other developing nations. </p>
<p>The bloc can become a launchpad for a longer-term development strategy that breaks away from the old styled US-led hegemonic system. As emerging powers leading the call for greater democratisation of the global order, Brazil, Russia, India and China need to show greater responsibility on global development issues. But this needs to be more than mere rhetoric that uses the same cliches as UN’s declarations. And it must want to work on the principles of equality.</p><img src="https://counter.theconversation.com/content/45017/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mohammad Amir Anwar does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The strategy of Brazil, Russia, India and China towards African development seems to be muddled with selfish national interests. Their focus is on areas critical to the growth of their economies.Mohammad Amir Anwar, Post-doctoral fellow, University of JohannesburgLicensed as Creative Commons – attribution, no derivatives.