BRICS in Africa, what you need to know

PUBLISHED: Mon, 23 Jul 2018 15:41:50 GMT
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This week a handful of the most powerful people on the planet will tread the pavement in Africa’s richest square mile to plot the way forward for the emerging economies of the southern hemisphere.

Russia’s Vladimir Putin, India’s Narendra Modi, Brazil’s Michel Temer and China’s Xi Jinping lead a group of presidents to the BRICS conference at the Sandton Convention Centre in Johannesburg on July 25,26 and 27. These are the strident leaders of the emerging economies armed with aggressive, long term, foreign economic policy, rich in resources and determined to see a shift of world power south from the northern hemisphere.

South Africa, which joined the south-to-south political and economic cooperation group in 2011, is chairing the group this year and has high hopes for it.

South Africa is very much the junior partner in the BRICS group that did R462 billion ($34 billion) in trade among themselves, in 2017, and garnered more than R554 trillion in foreign direct investments. In 2015, India gathered 38.9% of world foreign direct investment, Russia 26.1% while South Africa managed a mere 0.8%.

Yet South Africa will be hoping to use the gravitas of the organisation to help funnel investment in from Russia to Saudi Arabia and Qatar in search of fulfilling President Cyril Ramaphosa’s pledge of $100 billion in foreign investment.

South Africa plans to lead the way in talks over manufacturing, minerals process, science and technology. Tourism is also likely to be a topic for South African government officials with the country hosting around 200,000 tourists a year from BRICS countries, as will the fourth industrial revolution and peacekeeping.

“I think we may see a few infrastructure deals and trade agreements, especially with Russia, as South Africa tries to achieve Cyril Ramaphosa’s $100 billion foreign investment pledge,” says George Glynos, of ETM analysts.

“There will be a good deal of sharing of ideas and technology transfer, but I don’t think we will see too much concrete emerging from this conference,” says Azar Jammine, of Econometrix.

On the political front the big expected meeting will be between Putin and Xi Jinping to discuss the fall out of US President Donald Trump’s trade war.

President Modi plans to make a dash across the African continent to arrive in time for proceedings on Wednesday. At 9 am CAT the Indian premier will address the Parliament of Uganda, in Kampala, an address that will be carried live across the continent by CNBC Africa.

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