Brics: SA eyes big economic boost through trade and partnerships

As the country prepares to host the 15th Brics (Brazil, Russia, India, China and South Africa) summit, in Sandton next week, South Africa could be poised to reap the benefits of better access to foreign markets, free trade agreements and better loan terms from Brics financial institutions… developments which could help jumpstart our economy and create jobs.

But trade imbalances, especially with China, are a worry.

Busi Mabuza, chair of the SA chapter of the Brics Business Council, says the summit and the business-related events around it are an opportunity for the council to promote its proposal that SA’s partners in Brics “consider outsourcing or relocating parts of their industrial production to SA”.

This would be enabled by the African Free Trade Agreement and would benefit agriculture, automotive, pharmaceutical and logistics industries.

Michael Currin, the deputy director-general of intergovernmental coordination and stakeholder management at Government Communication and Information System, said that all Brics Business Councils are bringing large business delegations to South Africa.

Their flagship meeting is the Brics-Africa WBA Trade Conference in Durban tomorrow and on Monday.

While government and business delegations are here, there has been a concerted effort to expose visitors to SA’s unrivalled tourism offerings, in the hope this could dramatically increase visitor numbers from the Brics countries.

The Gauteng Tourism Authority said the summit is a significant opportunity to create jobs and boost tourism revenue.

“Recent reports have indicated that more than 40 countries have expressed their interest in joining Brics, so we can expect many more representatives from countries in the global south to make their way to Johannesburg.”

Mabuza, however, brought a note of caution into the euphoria.

“The trade deficit SA recorded last year is more than four times larger than the $3.7 billion (about R70.1 billion) deficit recorded in 2010 when it joined Brics.

“Raw materials dominate SA’s export basket to Bric markets, while SA mostly buys manufactured imports from Bric countries.”

This imbalance had to be dealt with, she said.