Becoming BRICS

By XING GUANGCHENG

Becoming BRICS

By XING GUANGCHENG

Adding South Africa to its ranks makes BRICS even more representative of global emerging and developing economies

In 2001, Jim O’Neill,Chairman of Goldman Sachs Asset Management, introduced the world to the idea of BRIC countries—Brazil, Russia,India and China, countries that were attracting international attention for their amazing economic development. The four emerging economies openly embraced O’Neill’s idea and began their summit meeting in 2009. Today, the concept has become a new platform for international communication and has added a new member, South Africa,to become BRICS.

The Third BRICS Summit will be held on April 14 in Sanya, China’s Hainan Province. Chinese President Hu Jintao will host the summit with top leaders from Brazil,Russia, India and South Africa in attendance.

A multilateral relationship

BRICS may not be a formal international organization, but an increasing number of countries have expressed their expectations for BRICS countries to assist with the recovery of the global economy. After the fi nancial crisis in 2008, existing international economic and financial orders, controlled largely by Western countries, showed their shortcomings. Now, the international community calls for global collective fi nancial governance.

Besides, fighting the recession in the crisis’ aftermath became a task much bigger than the Group of Eight (G8) major industrialized countries could handle on their own. Developing countries, such as China and Brazil, took the lead in coping with the recession and revitalizing global economic development, showing the significant role emerging economies can and will play in the world. BRICS members also benefited from dialogue and cooperation during the recovery. Their deepening coordination and cooperation enhanced their ability to resist and recover from the fi nancial crisis.

Foreign ministers from BRIC countries held their first meeting in Yekaterinburg,Russia in May 2008. Six months later, their finance ministers met in Sao Paulo, Brazil.In June 2009, the First BRIC Summit was held in Yekaterinburg, Russia. During the Second BRIC Summit in April 2010 in Brasilia, Brazil, leaders of the four countries signed a document on banking cooperation.Implementation of the milestone document marked a big step forward for BRIC countries in establishing a multilateral relationship.

BRICS’ strength

BRICS countries account for 30 percent of the world’s territory and 42 percent its population. In 2010, their aggregate GDP was 18 percent of the world’s total, while their total trade volume accounted for 15 percent of the global trade.

Developed countries, the World Bank and the IMF need to pay more attention to BRICS because of their rapid development and growing role in the international system. The rise of BRICS proves the world’s economic center is moving to the East and the South following the global fi nancial crisis.

BRICS focuses on discussing international financial supervision and global governance reforms. The group does not intend to challenge the Western world. But it seeks to uphold emerging economies’ interests and aspirations in the international economic system.

The changing terms of G7, G8, G8 Plus Five and G20, and calls for a G2 between the United State and China, re fl ect two clear tendencies.

The first is the political and economic influence of developing countries and emerging economies is increasing in the global community. To adapt to their growing in fl uence, existing international political and economic orders need to be improved.

The second one is China’s enhanced political and economic position. Its GDP exceeded Japan’s in 2010, making China the world’s second largest economy.China is playing a more important role in global political and economic affairs. It is gaining a bigger say in various international organizations and initiatives, both longstanding and newly established ones.

CLEAN ENERGY COOPERATION: Visitors check out Chinese solar panels on display at a new energy exhibition in South Africa’s Johannesburg on March 1

ECONOMIC STRENGTH:Participants pose before a meeting of BRIC finance ministers and central bank governors in London on September 4,2009

Shared interests

China and India are in Asia; Russia spans Europe and Asia; Brazil is in South America;and South Africa is in Africa. The attraction of BRICS is not their locations, spread out over much of the globe, but their common goal of improving economic cooperation.

With South Africa attending the upcoming summit in Sanya, BRIC will formally become BRICS. Covering a larger geographic area,the group will play a more representative and in fl uential role on the world stage. Now,BRICS is not only a concept but an active international presence that emphasizes economic growth rather than military clout.Vigorously developing emerging markets will improve BRICS countries’ economic strength and potential.

The participation of South Africa means the BRICS group is more geographically representative—it’s now more globally influential, embodying its ideal of democratization of global governance and multi-polarization. Some critics say South Africa is not qualified to be a member due to its weaker economic strength. However,its participation is of great geopolitical significance to both the other four nations and South Africa itself.

South Africa has developed rapidly in recent years. It is the biggest economy in Africa with numerous ports and ample mineral resources. The country is also considered as an example of Africa’s economic development. Through cooperation with South Africa, China, Russia, Brazil and India will be able to trade with and invest on the African continent more ef fi ciently.

South Africa’s entry will also assist with the organization’s development and improve its international cooperation. Now, with members from Asia, Europe, Americas and Africa, BRICS has truly become a global economic club.

While boosting its global profile,BRICS should explore new concepts for development. Inclusiveness, cooperation,dialogue and win-win results should be shared concepts of BRICS members.

While facing common problems in development, the five members have great cultural and political differences. This requires the countries to respect each other’s cultural traditions and political systems and focus on economic cooperation. In this way, they can also make greater contributions to building a new international economic order.

BRICS Nations

(Source:China’s Ministry of Foreign Affairs and National Bureau of Statistics)

The author is a research fellow with the Chinese Academy of Social Sciences