No. 347: Brics in Danger of Collapsing As Members Fail to Cohere / Rosaline Daniel and Kudrat Virk / Business Day
9 October 2015
With China's economy in slowdown mode and continuing to cause turmoil across the world, doubts have once again surfaced about the prospects of the Brics bloc (Brazil, Russia, India, China and SA).
Economic growth has been vital to sustaining the rise of the five emerging powers on the international stage. They played a pivotal role in enabling developing economies to weather the global financial crisis of 2008-09, with Brazil, Russia, India and China heralded as the main drivers of future growth in the global South.
However, the "big five" are in trouble. China is experiencing its lowest rate of growth 7% in the second quarter of this year in 25 years. India has matched China's growth but has not met expectations. Brazil and Russia are both in recession. SA's economy is contracting.
Are the Brics crumbling? And what would this mean for SA? As the most industrialised economy in Africa, SA has sought to position itself as the gateway to the rest of the continent. Participation in Brics has offered an opportunity to deepen and broaden the country's bilateral engagement with its allies, while enhancing its international profile.
China is SA's largest bilateral commercial partner, with total trade increasing from R5.6bn in 1998 to R262bn last year. In turn, SA is China's largest trading partner in Africa, accounting for 31% of Beijing's trade with the continent in 2013. Unsurprisingly, SA ranks fifth among African countries most exposed to the Chinese economic slowdown. The sixth Forum on China-Africa Co-operation, to be hosted by SA in December, will be keenly watched.
Bilateral trade between SA and India has similarly grown at an annual rate of 30% since 2004, to reach R90bn last year. However, this economic engagement is yet to reach its potential. More worrying, SA's trade with both India and China is heavily weighted in favour of primary products from SA and manufactured goods from India and China. SA has run persistent trade deficits with the two Asian countries.
Leveraging its inclusion in the Brics bloc to promote more equitable and mutually beneficial trade with New Delhi and Beijing, while obtaining access to technologies and skills in support of SA's industrialisation, remains a critical concern for Pretoria.
In comparison, SA's economic ties with Brazil and Russia have lagged. This has been reflected in low bilateral trade volumes, with SA-Brazil trade amounting to a modest R21bn and SA-Russia trade totalling a mere R8bn last year. While several Brazilian firms maintain offices in SA, these serve mainly as headquarters for their operations in other African countries. South African companies have a similarly limited presence in Brazil.
Russian business interests in SA are concentrated in mining and petrochemicals.
Nuclear power is an emerging area of co-operation in SA's relations with both Brazil and Russia. Pretoria and Moscow, for example, signed a $50bn nuclear framework agreement last year. In the same year, SA negotiated an agreement on nuclear technology with Brazil. Defence ties between the two countries have grown, with the development of the A-Darter air-to-air missile by SA's Denel in collaboration with Brazil.
Even so, SA's commercial and cultural ties with Brazil and Russia remain weak. This is at least in part due to a lack of mutual communication, both in the Brazilian and Russian media, about Africa, and also in the South African media about Moscow and Brasília. In Brazil, there is scant reporting on Africa, while in Russia, many elites have a view of Africa that often reinforces negative stereotypes about a continent of conflicts, disease, famine and safaris.
Beyond bilateral relations, there is a larger question facing SA and its Brics counterparts: is the bloc more than the sum of its parts? The presence, in 2011, of all five Brics countries on the United Nations (UN) Security Council for the first time since the grouping's formal inception two years earlier created an opportunity to collaborate on security issues of common concern and to challenge the dominance of the council by the US, France and the UK.
However, the responses of the Brics countries to the crises that the security council faced particularly over Libya raised serious questions about the bloc's ability to craft cohesive foreign policy positions. SA voted for the council resolution authorising the Anglo-French-led intervention in Libya, while Brazil, Russia, India and China abstained.
Deeper tension exists within the bloc on the issue of the international community's responsibility to protect populations at risk from egregious human rights abuses. SA has been supportive of this responsibility, which is enshrined in the African Union's Constitutive Act of 2000. China and India have been more reluctant to accept deviations from the principle of nonintervention, in particular the embrace of military intervention. Russia has offered rhetorical support for the responsibility to protect, invoking the principle when its interests are at stake, as in Crimea last year.
Brazil has proposed a new concept responsibility while protecting that stresses the accountability of interveners to the security council and the need to monitor how council resolutions are implemented.
The Brics umbrella also provides an opportunity for the five emerging powers to pursue reform of Western-dominated multilateral institutions such as the World Bank and the International Monetary Fund (IMF). Their dissatisfaction with the status quo gave impetus to the creation of the Brics's New Development Bank.
However, the Brics countries do not necessarily agree on how the architecture of global governance should be reshaped. This has led to an unresolved debate about whether they are status quo powers, or revisionist actors with a transformative vision for an alternative world order. For example, the bloc was unable to unite behind a common candidate to fill the top posts at the IMF and the World Bank in 2011 and 2012, respectively. The Brics countries have also seemed divided on developing solutions to key global challenges such as international financial instability and climate change.
Notwithstanding its regular summits, Brics is still a relatively new grouping with an evolving agenda for co-operation. Questions persist about its ability to coalesce into an agenda-setting actor with a harmonised approach to addressing global issues.
For China, the bloc is a tool to achieve its economic objectives, whereas for Russia the grouping is a means to challenge Western political hegemony. Brazil, India and SA, by contrast, follow a predominantly economic agenda within the Brics.
In this respect, the different priorities and expectations of the five Brics members as much as their economic woes could weaken their collective endeavour of creating a more democratic and equitable world order.
Daniel is a senior project officer and Virk a senior researcher at the Centre for Conflict Resolution