President Zuma addressed delegates at the inaugural BRICS Business Council meeting in Johannesburg, which took place just a few months after the fifth BRICS Summit in March in Durban.
“Our intention with the BRICS Business Council is to provide a platform to explore new models and approaches towards more equitable development and inclusive growth in the world,” said Zuma.
“The African Union is celebrating its 50th anniversary this year. In this regard, the BRICS-Africa engagement and dialogue signals a new departure and a new avenue to take forward the continent’s development agenda.”
BRICS is an association of emerging market and industrial economies that include Brazil, Russia, India, China and South Africa. The countries are characterised by fast-growing economies and combined, account for 43 per cent of the world’s population.
The combination also makes a total of 18 per cent of the world’s GDP and 40 per cent of currency reserves, which are estimated at around a trillion dollars.
Infrastructure, mining and minerals beneficiation, the services sector, manufacturing, energy and financial services were among the industries that President Zuma urged BRICS countries to focus on as channels of socio-economic development.
Africa’s largest infrastructure deficit, according to the World Bank, can be found in its power sector. Nigeria and South Africa, two largest economies in Africa, have had hampered growth due to poor electricity capacity and supply.
The 48 countries within sub-Saharan Africa, with a combined population of 800 million, generate roughly the same amount of power as Spain, which has a population of roughly 45 million. Filling the infrastructure gap will therefore be a crucial part of South Africa’s catching up to the development levels of its BRICS counterparts.
An increase in trade figures between the BRICS countries and South Africa are nonetheless boosting economic performance and growing foreign direct investment inflows.
In 2012, South Africa`s total trade with the BRICS countries stood at 294 billion rand, 11 per cent higher than 2011’s 264 billion rand.
Total trade with Brazil grew from 18 billion rand in 2011 to 20 billion rand in 2012, representing 11 per cent growth. Total trade with Russia increased from 3 billion rand in 2011 to 5 billion rand in 2012, a growth of 45 percent.
Total trade with India, South Africa`s sixth largest trading partner, from 53 billion rand in 2011 to 67 billion rand in 2012, representing a growth of over 26 percent.
Trade with China grew by 7 percent, from 188 billion rand in 2011 to 201 billion rand in 2012.
“While we appreciate that our intra-African trade is still marginal, real barriers are not tariffs, but include other factors such as under-developed production structures and inadequate infrastructure,” said Zuma.
“There is a lot of scope indeed for mutually beneficial partnerships within the BRICS community, which will create much-needed infrastructure in Africa.”