BRICS summit eyes trade

By Wang Cong in Mumbai and Yang Sheng in Beijing Source:Global Times Published: 2016/10/10 0:38:39

Leaders to focus on common ground, not differences

Leaders of Brazil, Russia, India, China and South Africa are expected to focus on their common ground rather than differences in order to make BRICS contribute more to the world economy amid the current global slowdown during a summit in the coastal state of Goa, India.

To improve economic partnerships within BRICS, the Indian government has launched a slew of programs, including a trade fair in New Delhi, a business forum and a business council meeting, the Indian Ministry of Commerce and Industry announced last week.

Merchandise imports from the world into BRICS countries have increased from $2.95 trillion in 2012 to $3.03 trillion in 2014, while global merchandise exports from BRICS countries have gone up from $3.2 trillion in 2012 to $3.47 trillion in 2014, according to a ministry statement.

Meanwhile, intra-BRICS trade has also risen. In 2012, intra-BRICS trade stood at $281.4 billion, increasing to $297 billion in 2014.

But "this encouraging trend needs to be strengthened as trade amongst BRICS nations is less than 5 percent of their total global trade," the statement said.

Gao Liankui, research program director of China and World Economic Governance at the Department of Economics of the Renmin University of China in Beijing, also said the bloc should not lose focus on building economic ties as a means to increase influence in global affairs.

Initiatives under the BRICS mechanism such as the New Development Bank (NDB) are positive steps to challenge the current global governance architecture, "which frankly doesn't reflect the role of emerging economies," Gao told the Global Times on Sunday.

The NDB, which was formed in July 2014 and became operational in February, aims to serve as a source of finance for developing and emerging economies to meet their developmental needs. The bank approved its first loans totaling $811 million to investment in renewable energy projects in all five countries.

Fight against terror 

The summit, also attended by leaders of the seven-nation Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation, will also prioritize the fight against terrorism, according to Indian media.

"[The] agenda is drawn in a broad-brush manner. We will be looking at the global economic and political situation. Obviously terrorism is a very important part of that," Amar Sinha, a spokesperson for India's Ministry of External Affairs said last week, the Hindustan Times reported Saturday.

While Sinha said India would not bring up the issue over China placing a technical hold on sanctions against Masood Azhar, chief of the Pakistan-based group Jaish-e-Mohammad, at the multilateral BRICS Summit, some Indian media outlets said Prime Minister Narendra Modi may address the issue during meetings with Chinese President Xi Jinping, citing government sources.

Zhu Jiejin, a senior researcher at the Institute of BRICS Studies at Fudan University, told the Global Times that it is usually easier to reach agreement in economic areas than on political and security issues, "so if India wants to boost economic cooperation, then it should not raise disputed topics during the summit."

According to The Hindu, an English-language Indian newspaper, apart from terrorism, Chinese opposition to India's membership in the Nuclear Suppliers Group (NSG) offends India deeply and India might also mention this during the summit.

Lin Minwang, a member of the Academic Committee at the Pangoal Institute told the Global Times Sunday that in September, China's foreign ministry already explained China's position and the Indian government knows that China will not change its position easily.

"China is not the only country opposing India's membership in the NSG, there are five more [New Zealand, Ireland, South Africa, Turkey and Austria], but the Indian media only blamed China, which is not fair," Lin said.

Short-term woes

At present, some BRICS members like Brazil and Russia are seeing slow economic growth, and Brazil's domestic political situation is unstable, but Zhu said these problems are likely to be short-term.

While the economic problems are serious, they are mostly caused by a drop in the price in major commodities like oil and steel, on which countries like Russia and Brazil are heavily reliant. 

"But this is temporary," he said. "BRICS have markets, resources, labor force and land, and these are elements for economic development, so the potential for BRICS is solid."

Posted in: Diplomacy

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