Speaking at the World Economic Forum’s annual meeting in Davos, Switzerland, Gordhan encouraged the BRICS nation to build on the progress it’s made in the last two decades.
“The global financial crisis, which was not of our making, did huge damage. We now need to enhance the skills of our citizens and improve our infrastructure to take advantage of the opportunities ahead,” he said.
BRICS nations Brazil, Russia, India, China and South Africa each experienced some fallout from the global financial crisis. They have however, said that they will rebound over the next few years.
China, by far the biggest of the BRICS nations with a population of 1.351 billion, recently hit a rough economic patch and questions arose over the ability of the Asian nation to continue its rapid growth.
Liu Mingkang, a distinguished fellow at Fung Global Institute in Hong Kong, dismissed concerns that China’s economy would run out of steam.
“In the short term, tapering of quantitative easing will create huge volatility in capital flows. We will certainly be hit by this volatility but, hopefully, not shocked,” he said.
“The new government’s focus is on three priorities: reducing overcapacity, notably in heavy industry; lowering borrowing by provincial governments and increasing transparency in the markets for their debt and reducing China’s dependence on export markets by stimulating internal demand.”
Guido Mantega, Brazil’s finance minister, said it will not return to its pre-crisis growth levels soon, but it is already consolidating the reforms introduced over the past decade that have raised the incomes of the poorest people in society.
“Efforts to promote private investment will also continue with licences worth 250 billion US dollars about to go for auction. These cover railways, ports and airports, motorways and other infrastructure,” he said.