CAPE TOWN - When South Africa was invited to join the BRICS alliance of emerging economies in 2010, there was some noise about why the decision had been taken.
The questions around South Africa’s inclusion arose from the fact that the BRIC alliance was formed to represent the world’s strongest emerging markets that could hold their own against the G8 and G20 and the forum of the world’s wealthiest economies.
The BRIC alliance was formed after a 2001 Goldman Sachs report coined the acronym and argued that the world’s next wave of economic growth would come from Brazil, Russia, India and China.
China was the world’s second largest economy at the time; Brazil the seventh, Russia the ninth and India the tenth.
South Africa, on the other hand, with a gross domestic product of less than R3.96 trillion and a population of less than 56 million people, was too small to qualify for inclusion into BRIC, it was argued. But in 2010, notwithstanding the economic weighting argument, the country was included into the BRIC alliance, which now became BRICS.
The move was seen by some quarters as a mere symbolic gesture to include a representative of the African continent and South Africa was chosen for being a "gateway" to "the last frontier of growth". Those within the alliance argued that South Africa’s invitation to join BRICS recognised the country’s contribution to shaping Africa’s renaissance, as well as the country’s role in diplomatic and peace keeping initiatives on the continent.
Although South Africa’s economic performance has not come close to its BRIC partners, there was an important rationale behind the decision to include South Africa, and one which has proven to be strategic in this second decade of the BRIC partnership.
South Africa is the natural choice for inclusion in a broader alliance of emerging market economies. While South Africa may be a small economy, its impact on the African continent is significant. The Ernst & Young Africa Attractiveness Survey (2017), for example, indicates that South Africa was during the period 2016/17 the sixth largest source of foreign direct investment in the African economy.
Peace and security
This accounts for both state-owned entity and private sector investments. Furthermore, the Good Country Index ranks South Africa 2/163 for Contribution to International Peace & Security. The latter is directly linked to the country’s role in supporting peace and security and the agenda of human development and social security in the African context.
With 68percent of EU firms that operate in Africa headquartered in South Africa, with its modern infrastructure and advanced financial services sector, South Africa is an obvious choice as a base for African operations. South Africa is a natural connector and bridge between the developed and the emerging world and BRICS partners can benefit from its expertise and experience in the region.
In the past decade, however, development of the BRICS as an organisation indicates that the common objective of maintaining a multilateral world order, based on respect for diversity, goes far beyond the argument of relative economic size. In fact, South Africa’s influence within the BRICS can be seen in Summit declarations since 2011 that clearly show how the BRICS focus not only on South African issues, but often take positions on African peace and security, and support for the African Union’s Vision 2063.
Former president Thabo Mbeki was the champion for the African renaissance and is referred to both by admirers and detractors as Africa’s finest diplomat. Mbeki sought ways to strengthen South Africa’s economic diplomacy with other African states and it was arguably Mbeki that laid the groundwork for South Africa to be considered as a partner to the BRIC nations. It was also his vision of an African Renaissance that saw South Africa as the champion for the growth and development of the broader continent.
As South Africa holds the BRICS chairpersonship in 2018, the African continent is central to the BRICS theme this year: BRICS in Africa: Collaboration for Inclusive Growth and Shared Prosperity in the 4th Industrial Revolution. The 10th Summit provided a strategic platform for South Africa to expose BRICS partners to a dynamic and diverse experience on the southern tip of the African continent.
Leaving out the African continent, which has enjoyed growth rates of 3.6percent after the global financial crisis in 2008 up to 2014, would not make sense for the BRICS agenda’s inclusive growth and peace and security mandate.
Africa has also played a critical role in the rise of China and the rise of the non-Western world. Africa forms a key part of China’s One-belt, One Road initiative which is central to the country’s geopolitical and regional economic expansion drive. This initiative provides a link for China between the North-South Corridor and the One Belt Road via Kenya.
As South Africa hosts the BRICS Summit in Johannesburg from July 25 to 27, 2018, our government is committed to optimising its position as an African nation within BRICS. This is particularly apt as South Africa (during June 2018) formally signed the African Continental Free Trade Area agreement. Forty-nine African states have thus far acceded to the agreement.
Once again, due to South Africa’s infrastructure (hard and soft), diversified economy and role as investor in the regional economy, it is well placed to advance the African agenda and promote the cause of an integrated, stable, prosperous African continent within the BRICS. As Africa rises, so must South Africa.
As BRICS has embraced an inclusive approach, bucking trends of anti-globalisation, and counter-integrationist discourses that have emerged in the northern hemisphere, the organisation is solidifying a multilateral, and fair global governance system which has Africa as an integral part of this global governance institution.
This is not only good news for Africa, but good news for the world. At the conclusion of the 8th BRICS Ministers of Trade meeting (July 5, 2018), Dr Rob Davies stated: “We also concluded a BRICS statement on World Trade Organisation (WTO) matters that conveys the BRICS members' concern with the systemic impact of unilateral measures that are incompatible with WTO rules and that put the Multilateral Trading System at risk”. This is, of course, a statement in the context of growing trade war initiatives, imposition of tariffs, and economic nationalism taking root and impacting negatively on the global economy.
This means that South Africa calls, with BRICS peers, for a fair and open global trading system, and warns against growing unilateralism. As a country South Africa’s membership of BRICS, its signing of the Asean-China Free Trade Area. indicate that it is a nation striving - with peer emerging markets (BRIC) for deeper interactions, and measures to enhance co-operation at a global level in a period where so-called advanced nations are withdrawing into protectionism and isolationism.
BRICS as an organisation connects 42 percent of the world’s population and is establishing new institutions and conversations to create a world which previously side-lined Africa. It is actively building bridges of mutual understanding for a more equitable and fair world.
Nomvula Mokonyane is the Minister of Communications of South Africa.
The views expressed here are not necessarily those of Independent Media.
-BUSINESS REPORT