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CAPE TOWN, South Africa, Jan 6 2011 (IPS) - South Africa’s inclusion in the BRIC group of powerful emerging economies has sparked intense debate, with some saying it has done itself a disservice by trying to punch above its weight, and others lauding the inclusion as a step towards becoming a more important player on the global stage.
South Africa was formally invited to join Brazil, Russia, India and China as a full member of the group in late December. Significantly, but unsurprisingly, the invitation came from China, which has become the country’s largest trading partner.
The move has been a long time coming. South Africa has doggedly lobbied the BRIC Forum in a bid to become a full member. President Jacob Zuma followed up government efforts with talks with BRIC leaders last year to promote the country’s case.
But the move has been criticised by some analysts and commentators, particularly as they say South Africa, is a far smaller economy than the other four, will be treated as very much the junior partner.
“It’s degrading to have to lobby for membership. It would have been different if the country had been invited in the first place. South Africa will simply be playing second fiddle to Russia, Brazil, China and India,” believes Mzukisi Qobo, the Head of the Emerging Powers and Global Challenges Programme at the South African Institute of International Affairs.
The country’s GDP of $285 billion pales compared to Russia or India’s ($1.6 billion), let alone Brazil or China’s. Its population is much smaller and its economic growth of around 3 percent is a shadow of China’s 10 percent, Brazil’s 7 percent and India’s 8 percent.
Increasingly economically powerful Indonesia was recently touted as a more worthy candidate than South Africa – with Turkey, Mexico, South Korea and Nigeria also considered ahead of South Africa. O’ Neil has been quoted as saying he was opposed to the country being included, due to its small size and struggling economic record.
The decision to pull South Africa on board seems to be far more political than economic. Qobo believes the country’s political standing and diplomatic clout has had a lot to do with its ascension to the Forum.
“Its made substantial contributions to global governance issues and played a very active role in post-conflict reconstruction in Africa. Its voice has been fluent and it’s seen as an honest broker in international relations. That would definitely have some influence,” says Qobo.
While most analysts are skeptical of its ascension, some believe it is a strategic and clever foray by South Africa.
“It’s very politically astute and it’s what South Africa needs to thrust the country into the first tier of emerging markets,” says Martyn Davies, CEO of Frontier Advisory Services.
More importantly, he believes it could be an incentive to SADC’s 15 member countries.
“Countries like Indonesia, Mexico, South Korea and Vietnam were all above us on the list. What they don’t have is a hinterland economy of 250 million people in Africa. If we can confidently market our region as an integrated market to the BRIC countries, then that’s exactly what we need.”
Old Mutual Chief Executive for South Africa and developing markets, Kuseni Dlamini, has also thrown his weight behind BRICS, saying there is a compelling case for the country to play an increasing role in world affairs and encourage investment on the continent.
“This should enhance South Africa’s positioning in an increasingly globalising and competitive world. Joining BRIC can and will unlock investment and market opportunities for South African companies which are growing and expanding their footprints offshore,” he told IPS.
International Monetary Fund statistics show that the economy of Sub-Saharan Africa grew from $322 billion in 2000 to $931 billion in 2008. China has made massive inroads into the continent, becoming Africa’s largest trading partner in 2009 and in many cases toppling the traditional trading positions of EU countries in Africa.
But political analysts and economists say the country would be far better placed to consolidate its position in IBSA, which is made up of India, Brazil and SA. “IBSA is far more meaningful than BRIC, which is a club of diplomats and politicians,” says Qobo.
IBSA involves a range of government ministries, incorporating trade and industry, science and technology, education and transport. It also has valuable private sector, civil society and academic forums.
Qobo also added that, “The IBSA countries have shared values, they’ve articulated a very clear agenda and have worked very well together in multilateral trade negotiations.”
In contrast, he believes the BRICS set-up is an uneasy fit, with tensions between BRIC countries. “These countries don’t have clearly thought-out concepts to make sense of a changing environment. They share far less in common than the IBSA group. It could well backfire to join BRIC. SA is yearning for significance, affirmation and being part of a global hub, but it’s going about it the wrong way.”
Qobo says the country should rather stick with the tested IBSA arrangement and focus on its bilateral relations with countries where meaningful trade opportunities are unlocked. “There is no substitute for bilateral relations.”
President Zuma, will square up against his BRIC counterparts at the third BRICS Leaders’ Summit in China this year. And many from the African continent will be closely watching to see how the country makes its mark in the Forum.
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