BRICS and the New Model
The fifth Brics Summit, and the first in the African part of the grouping, a fortnight ago ended with the bloc declaring its new approach to the world economic and political systems.
The Ethekwini Declaration, named after the Durban venue in which the BRICS leaders from Brazil, Russia, India China and South Africa met, pronounced the new zeitgeist.
“The prevailing global governance architecture is regulated by institutions which were conceived in circumstances when the international landscape in all its aspects was characterised by very different challenges and opportunities,” reads the Declaration.
“As the global economy is being reshaped, we are committed to exploring new models and approaches towards more equitable development and inclusive global growth by emphasising complementarities and building on our respective economic strengths.”
The leaders reaffirmed commitment to the promotion of international law, multilateralism and the central role of the United Nations.
“Our discussions reflected our growing intra-BRICS solidarity as well as our shared goal to contribute positively to global peace, stability, development and cooperation,” they said.
“We also considered our role in the international system as based on an inclusive approach of shared solidarity and cooperation towards all nations and peoples.”
BRICS will be open to increasing our engagement and cooperation with non-BRICS countries, in particular Emerging Market and Developing Countries support Africa's integration processes, industrialisation, foreign direct investment, knowledge exchange, capacity-building and diversification of imports from Africa.
The bloc was unhappy with some “policy actions in Europe, the United States and Japan aimed at reducing tail-risks in the world economy” some of which “produce negative spillover effects on other economies of the world”.
BRICS will help developing countries stave off challenges of infrastructure development due to insufficient long-term financing and foreign direct investment, especially investment in capital stock.
The reform of international financial institutions such as the World Bank and the IMF – for long a concern for the developing, non-Western world – came under the microscope.
BRICS called upon the institutions to reform “to make them more representative and to reflect the growing weight of BRICS and other developing countries”.
The leaders added: “We remain concerned with the slow pace of the reform of the IMF. We see an urgent need to implement, as agreed, the 2010 International Monetary Fund (IMF) Governance and Quota Reform.
“We urge all members to take all necessary steps to achieve an agreement on the quota formula and complete the next general quota review by January 2014.
“The reform of the IMF should strengthen the voice and representation of the poorest members of the IMF, including Sub-Saharan Africa. All options should be explored, with an open mind, to achieve this.
“We support the reform and improvement of the international monetary system, with a broad-based international reserve currency system providing stability and certainty.”
The world leaders have agreed to set up a BRICS Bank.
The leaders emphasised the importance of ensuring steady, adequate and predictable access to long term finance for developing countries from a variety of sources and called for “an open, transparent and rules-based multilateral trading system”.
SMEs play a “fundamental role” in the economies of our countries, the leaders affirmed.
Politically, BRICS say they are committed to the UN “as the foremost multilateral forum entrusted with bringing about hope, peace, order and sustainable development to the world” while there is the need for a “comprehensive reform of the UN, including its Security Council, with a view to making it more representative, effective and efficient, so that it can be more responsive to global challenges”.
BRICS also commended the efforts of the international community and acknowledge the central role of the African Union and its Peace and Security Council in conflict resolution in Africa but was unhappy with the deterioration of the security and humanitarian situation in Syria.
The bloc is set to explored new areas of co-operation in fields such as public diplomacy, anti-corruption co-operation, state-owned companies/enterprises, drug control, youth issues, tourism, energy and mega sporting events.
A new magazine for the Brics is also now out.
Analysts have, naturally, been scrutinising South Africa’s role in BRICS. Some say South Africa is the gateway to Africa, while others say South Africa’s “seat at the table is warranted in some measure”.
The country joined the bloc in 2010.
Some opinions have pronounced South Africa “the odd BRIC out” in respect to its economy and population size and ultimately its contribution to this league.
South Africa is by no means one of the biggest economies in the world.
In an opinion article titled “SA punching above its weight” in the Times newspaper, TJ Strydom, posited, “Does the BRIC part of BRICS really need the ‘S’?”
He argued: “Our economy and population is the size of a modest province in any of the other members. And even if South Africa is not a massive market for Chinese, Indian, Brazilian or Russian goods, their wares can nevertheless do quite a bit of damage in South Africa.
“Sugar producers in Mpumalanga complained last year about Brazilian sugar landing in Cape Town.
“This as South Africa produces more than enough of the sweet stuff to satisfy domestic demand.
Brazilian chicken also found its way into South African supermarkets last year, prompting local poultry producers to complain of dumping.
And the debate about cheap imports from China devastating our textile industry has been going for more than a decade.”