BRICS requires a more pragmatic mindset

By Wang Yuzhu Source:Global Times Published: 2016/10/24 0:08:39

Illustration: Luo Xuan/GT

Illustration: Luo Xuan/GT

With a wide geographical distance separating the BRICS nations - Brazil, Russia, India, China and South Africa - the economic connections between these countries don't seem close when measured by the volume of bilateral investment and bilateral trade. In this regard, the mindset of developing traditional forms of cooperation needs to be set aside. Instead, the member countries need to elevate their collective recognition of the BRICS mechanism through deeper pragmatic cooperation and interaction.

Promoting pragmatic cooperation among the BRICS nations can be reflected in three ways.

First, financial cooperation with a pragmatic attitude has been promoted in depth and breadth. Currently, substantial progress has been seen in the Contingent Reserve Arrangement established by the BRICS nations that was designed to forestall short-term balance of payments pressure, offer mutual support and enhance financial stability. Meanwhile, aside from previously established infrastructure financing projects, when it comes to future project selection and mechanism design, the BRICS-led New Development Bank is expected to conduct further innovative exploration on practical and technical level. In addition, the BRICS members are expected to establish concrete cooperation in the insurance and reinsurance markets, in credit ratings and on the crackdown of illegal capital flows. Deepened cooperation in the finance sector could optimize the allocation of financial resources across regions and make up for long-term capital shortage due to worldwide funding mismatch.

Second, institutional innovation in regional cooperation could better serve the interconnected development of BRICS. One of the most prominent achievements at the 2016 BRICS summit in Goa, India lies in the bilateral dialogue and cooperation between BRICS and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) countries. This innovative mechanism for regional cooperation could not only help break the bottleneck in the development of traditional cooperation mechanisms, but also provides a cooperation platform for China and India to seek "responsive, inclusive, and collective solutions." Moreover, BIMSTEC could bridge and facilitate Sino-Indian economic exchanges and become a cohesive point for future China-India cooperation. A similar development model that connects regional cooperation should be adopted by all other BRICS members, and could be further extended to the Eurasian, African and Latin American regions to finally establish a positive relationship with the Belt and Road initiative.

Third, BRICS nations have committed to make pragmatic individual and collective efforts through pushing forward the implementation of the 2030 Agenda for Sustainable Development by the United Nations (UN). Emerging economies - BRICS included - as some of the main participants in the UN's 2030 agenda face pressure from developed countries over issues including carbon emissions, environment protection and international development responsibility and need to respond to these pressures with true action. In September at the UN's high-level meetings of the 71st session, Chinese Premier Li Keqiang announced China's National Plan on Implementation of the 2030 Agenda for Sustainable Development, showing the world the largest developing country's effort on facilitating sustainable development. In the future, the BRICS countries will be expected to enhance cooperation in this field as well.

Apart from the above examples, pragmatic cooperation among the BRICS countries can also be established in certain subdivisions. For instance, on trade facilitation, the Regulations on Customs Cooperation Committee of BRICS has been approved to push forward policy implementation. For implementing the Strategy for BRICS Economic Partnership, the BRICS Roadmap for Trade, Economic and Investment Cooperation until 2020, which is of greater feasibility, has been pushed forward and implemented.

Looking ahead, further steps are expected to be made in 2017 when China chairs the next BRICS summit. Besides moving forward with the project implementation, China is expected to conduct more concrete moves, including the reform of the cooperation mechanism between BRICS countries, to better respond to changes in global political and economic structures. To harvest more recognition from the international community, more pragmatic actions are needed in the BRICS cooperation.

The author is a research fellow with Institute of World Economy, Shanghai Institutes for International Studies. bizopinion@globaltimes.com.cn

Posted in: EXPERT ASSESSMENT

blog comments powered by Disqus