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POLICY BRIEFING 24

Emerging Powers and Global Challenges Programme

September 2010

BRIC and IBSA Forums: Neo-liberals in Disguise or Champions of the South?

Joseph Senona 1

r ec o m m e n d at i o n s

• South–South forums should E x ec u t i v e S u m m a r y move beyond rhetoric and adopt inclusive, practical working outh–South co-operation has existed for many decades and has played methods and action plans that a key role in solidifying unity among developing . However, promote a common development S the concept of South–South co-operation has evolved from being concerned agenda, which will benefit the with and opposing , global racism and , South, especially the weaker to an emphasis on geo-economics and political economy. Consequently, the countries in Africa, and that focus has been on achieving and growth for the build and re-enforce existing South collectively, against the backdrop of rapid globalisation. South–South mechanisms. The emergence of , and , as economically and • The IBSA and BRIC countries politically influential developing countries, is beginning to reconfigure and should urgently adopt an reshape the terms of South–South co-operation yet again. These countries outreach mechanism similar to are driven by an ambition for global economic dominance and political that of the G8+5 and afford other leadership. developing countries observer This development raises an important question: what are the benefits status, or special recognition, and prospects for the entire South? Will these countries take up the at their summits, in order to challenge and begin to assert South–South solidarity for the benefit of all, promote collectiveness and or are they using the notion of South–South for their own advantage? No inclusivity. doubt, the BRIC (Brazil––India–China) and IBSA (India–Brazil– • When speaking on behalf of ) countries need to continue working together to improve and the entire South, BRIC and IBSA assert their dominance. This must not come at the expense of the principles countries should be given the of South–South co-operation, which are meant to protect and to advance opportunity to receive mandates the development of the weaker states. and to report to both regional It is therefore imperative for countries of the South, and particularly and global South–South forums, Africa as the most vulnerable continent, to be circumspect and not take such as the South Summits, these new South–South alliances at face value. Analysts would also do well NAM Summits, and G77+China to probe and offer a critical appraisal of this new notion of South–South Summits, in order to ensure co-operation. This policy brief aims to make a contribution towards the transparency and integrity of the debate. South–South solidarity.

A f r i ca n pe r s pec t i v e s . G l o b a l i n s i g h t s . b r i C a n d i b s A F o r u m s : n E o - l i b e r a l s i n D i s g u i s e o r C h a m p i o n s o f t h e S o u t h ?

I n t r o d u c t i o n BRIC: The path to 2050’.2 In a move to put this theory into practice, the BRIC economies met Excitement surrounding BRIC, as the new centre in , Russia for the first time on of South–South co-operation, seems to have 16 June 2009, with the aim of formalising the reached fever pitch in South Africa. The creation alliance. In a manner reminiscent of the new of institutional structures, such as the BRIC world order talk in the 1970s, the BRIC leaders Forum and IBSA, is a powerful indication of a called for establishment of a multipolar world newly found confidence among these middle- order. However, no serious attempt was made to income developing countries, which have been explain what this means exactly, or to show how rushing to form so-called ‘strategic partnerships’ global governance would be anchored in their with each other. structures. Is there really some substance to the hype It is interesting to note that India and Brazil about emerging powers? Is this possibly the kind are both founding members of BRIC and IBSA. of geopolitical shift that could spur the entire No formal pronouncement was made at the BRIC South to a cohesive and sustained economic about South Africa’s membership, which emancipation? This new development evokes remains uncertain. However, during a recent visit an eerie feeling of nostalgia, which recalls the to the BRIC countries, the president of South excitement at the famous Bandung Summit of the Africa, who was accompanied by ministers and 1950s and the talk of New International Economic senior business people, apparently called for Order championed by the South in the 1970s. South Africa’s inclusion and membership of BRIC, Both were political ‘waves’ that developed against among other things. the background of the Cold and colonialism. For some pundits, the exclusion of South Although not the revolution that obtained total Africa is justified by the BRIC countries’ relative emancipation from the North, these ‘waves’ were economic strength compared to South Africa. Yet, needed to erode the South’s dependency on the South Africa’s membership of the alliance is more North, to weaken the North’s strong hold on the than a matter of political idealism. It is of practical world economy, and to loosen the vice-like-grip importance, given the ’s dominant and of poverty and underdevelopment on the South. pivotal role in Africa, coupled with a relatively ‘Waves’ alone are not enough. History strong economy, well-developed infrastructure shows that major change requires a succession and institutions. As the springboard for investing of unrelenting ‘tsunamis’, in order to break in Africa, South Africa could play a central role down and completely reverse the neo-liberal in articulating and championing the development globalisation trend and set in motion a truly interests of the continent. Indeed, considering global development agenda. Both the BRIC and the heavy involvement of BRIC countries on the IBSA forums have the potential to turn into such African continent, it is fitting that South Africa ‘tsunamis’, but first they need to restructure and plays a unique role in the BRIC Forum. occupy the moral high ground by being more The Brasilia Declaration, which inclusive and, specifically, taking on Africa’s institutionalised IBSA co-operation, states that development interests. the IBSA platform’s main objective is economic IBSA Trilateral co-operation was launched co-operation. Significantly, a plan of action and in 2003 through the Brasilia Declaration. mechanism are in place for areas of co-operation. Its formation represents a major policy The BRIC Forum, on the other hand, is geared synchronisation that essentially brings together more towards a coalition for global political three continents to strengthen and governance. Paragraph 15 of the Joint Statement reinvigorate South–South co-operation. BRIC, on of the 2009 BRIC Summit asserts that: ‘We the other hand, is the brain-child of investment have agreed upon steps to promote dialogue bank theories and conjectures championed by and co-operation among our countries in an the 2003 report, ‘Dreaming with incremental, proactive, pragmatic, open and

S A i i A P o l i C Y b r i E f i n G 2 4 2 b r i C a n d i b s A F o r u m s : n E o - l i b e r a l s i n D i s g u i s e o r C h a m p i o n s o f t h e S o u t h ?

transparent way.’ So far, these aspirations and It is also interesting to note that, unlike the pronouncements have not translated into any IBSA trilateral co-operation, the BRIC coalition is precise areas of co-operation or joint co-operation not exclusionary. An expansion or incorporation mechanisms. is envisaged, particularly as potential South The lack of a common goal, which is evident members are likely to meet criteria that would from the lack of common areas of co-operation qualify them as ‘emerging economies’. Perhaps in the BRIC countries, is perhaps indicative of even more interesting is Russia, whose status differences in national goals, as well as political as South or North is unclear, given its formal and economic tensions among the countries. It membership of the G7 club of rich countries could also be that, as a result of the recent global and its Organisation for Economic Co-operation economic downturn, the appetite to enter into and Development accession status. Even so, the more formal structures has been overcome by latter has somewhat legitimised questions about the desire to look inwards. Whatever the reason, whether the BRIC alliance is truly championing the forum has clearly galvanised and energised South–South co-operation. support for South–South co-operation, which, Being developing and emerging, the BRIC like the IBSA co-operation, has the potential to countries would ordinarily have a larger appetite consolidate and deliver on the aspirations of the for commercial interests. However, despite South. such mercantilist tendencies, they appear to set At the 2010 BRIC Summit, Prime Minister themselves apart from the traditional neo-liberal of India reiterated the need mercantilist tendencies by being less exploitative, for the BRIC countries to improve, calling in and more sympathetic and responsive to Africa’s particular for closer co-operation in the fields development agenda. of energy, food security, trade and investment, Nevertheless, countries of the South, in science and technology and infrastructure. It is particular African countries outside of IBSA and thus probable that, in the future, some form of the BRIC, need to be circumspect when dealing co-operation mechanism, similar to IBSA, will be with these emerging powers. Africa should ask structured to drive BRIC. probing questions and not take these alliances at face value, as these countries are strong, fast- S o u t h – S o u t h C o - o pe r a t i o n emerging economies already claiming a serious o r I n c o r p o r a t e d ? stake in global economic dominance.

In examining the potential for success of the C o n c l u s i o n IBSA and BRIC processes, the critical question is whether they will solidify South–South Over the next 20–50 years, the BRIC and IBSA co-operation and generate benefits for Africa and countries could become the most dominant the South. Or, are we witnessing a phenomena of economies in their respective regions and in ‘South–South Incorporated’ led by self-serving, the world. Talk about the rise of the South, and mercantilist countries? The Goldman Sachs report shifts in geopolitics, often refers to the emergence predicts that, by 2050, the BRIC countries could of these giants. They make ideal and attractive become four of the most dominant economies and long-term strategic economic and/or political collectively larger than the G7 countries. To be partners for both the South and North countries. part of the same league, and perhaps surpass the Significantly for Africa and the South, they are G7, should therefore be the core interest of the ideal partners to drive the development agenda BRIC countries. Or, are they no longer interested and promote alternative mechanisms to the neo- in wearing the garb of South solidarity, except as a liberal globalisation agenda. way of gaining commercial advantage over Africa, These long-term strategic development in relation to the developed North’s commercial partnerships should be guided and centred on interest in the continent? the South–South co-operation principle adopted

S A i i A P o l i C Y b r i E f i n G 2 4 3 b r i C a n d i b s A F o r u m s : n E o - l i b e r a l s i n D i s g u i s e o r C h a m p i o n s o f t h e S o u t h ?

by the 32nd annual meeting of the Ministers of, African countries, the emergence of BRIC and of of the Member States of the IBSA could be the needed ‘tsunami’ that the South and China on 26 September 2008, has been looking for to shift the pattern of global in New York, of America. Indeed, governance in its favour. to avoid turning into yet another rich man’s club, Just as the G7 economies drove the neo- the BRIC and IBSA countries should include the liberal globalisation agenda for a long-time, the entire South in their efforts and partnership. In BRIC and IBSA countries combined can begin to particular they should remember the following define, champion and drive a new development. principles:3 Surely, by remaining true to the cause of the South, and the fundamental principles of South– • South–South co-operation is a common South co-operation and solidarity, these countries endeavour of peoples and countries of the will not only achieve greatness for their people, South, and must be pursued as an expression but will reshape the global system and achieve of South–South solidarity and a strategy for the goal of a multipolar world. These emerging economic independence and self-reliance, giants should strive to recognise their historical based on their common objectives and responsibility. Nothing rings truer than the solidarity; South–South principle proclaiming that: ‘South– • South–South co-operation is a development South co-operation is based on the collective agenda based on premises, conditions and self-reliance of all developing countries’. Unless objectives that are specific to the historical the spirit of the collective is infused in the and political context of developing countries motives and objectives of these emerging powers, and their needs and expectations; the developed North will continue to dominate • South–South co-operation is based on a and ‘development’ will remain a lofty ideal. strong, genuine, broad-based partnership and solidarity; E n d n o t e s • South–South co-operation is based on complete equality, mutual respect and mutual benefit; 1 The author is an official of the Department of Trade • South–South co-operation respects national and Industry of South Africa working on African’s in the context of shared development issues. Views expressed herein are responsibility. those of the author and not of the organisation. He can be contacted at [email protected]. The above principles are only indicative. In 2 Wilson D & R Purushothaman, ‘Dreaming with reality, the social and economic challenges facing BRICS: The Path to 2050’, Global Economic Paper, the developing South require pragmatic, unsullied 99. New York: Goldman Sachs, 2003. and perhaps alternative solutions to what 3 South Centre, ‘South–South Cooperation Principles: currently exists. Pragmatism, and not political An Essential Element in South–South Cooperation’, rhetoric, is critical when designing new solutions South South Policy Note. : South Centre, from strategic partnerships. If managed well, and November 2009. with greater sensitivity towards, and inclusion

The Emerging Powers and Global Challenges Programme is funded by the Swedish International Development Co-operation Agency and the Danish International Development Agency, facilitated through the Danish Embassy in Pretoria. SAIIA gratefully acknowledges this support. © SAIIA 2010 All rights reserved. Opinions expressed are the responsibility of the individual authors and not of SAIIA.

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