SEIFSA commends South Africa and the South African BRICS Business Council, on the successful hosting of the BRICS Summit and Business Forum. Although the summit is still ongoing, and scheduled to end on Thursday, the traction on a number of fronts thus far is welcomed and encouraging.
The world has stood to take notice that the BRICS pact is not simply a loose agreement, but a formidable platform on which tangible traction is being registered. South Africa has done a phenomenal job of showcasing this and encouragingly brought the entire African continent along.
On matters of economic policy, cooperation, in any form, is always critical. Moreover, collaboration between a group of countries that constitute 30% of the global gross domestic product (GDP), 42% of the total population and 20% of international trade, presents a real opportunity to move the needle on economic progress among these countries.
The global South has historically been fragmented in its approach to economic cooperation and the BRICS platform is a key and strategic avenue to achieving this. More than 40 countries have expressed interest in joining BRICS and of them, nearly two dozen have formally asked to be admitted. Expanding the bloc with additional countries will only serve to strengthen the reach, clout and influence of the cooperation.
At the BRICS Manufacturing Forum hosted on Monday the 21st of August, an event in which SEIFSA participated, two MOUs were signed between the Department of Trade, Industry and Competition (DTIC) and the China African Development Fund; and a second between the Bank of China and the Industrial Development Cooperation (IDC). Both MOUs focused primarily on deepening industrialisation and collaborating with Development Funding Institutions (DFI’s) funding for special projects in South Africa.
BRICS provides South Africa with tremendous opportunities. The BRICS economies account for about 21.3% of South Africa’s trade with the world in 2022. Trade between South Africa and T7% to reach $50.1 bn. However, talking up our potential is not good enough. We need policies to be implanted with speed and urgency in order to enable companies to become globally competitive in areas where we have a competitive advantage so that we can grow our economy and exploit global opportunities. Furthermore, South Africa must push for the accelerated implementation of the African Continental Free Trade Area (AfCFTA) to boost the continent’s economic growth.
AfCFTA which came into effect in January 2021, will become the world’s largest free-trade area. This agreement will connect 1.2 billion people across 55 countries with a combined GDP of $3.4 trillion. As a country, we have to take advantage of this development on our doorstep and position ourselves as a country and continent that can produce the goods the BRICS countries want.
South African companies are the largest trading partners on the content, BRICS and AfCFTA offer huge opportunities to grow our economy and address the unacceptably high level of unemployment.
SEIFSA welcomes the report released today that Chinese investors view South Africa as one of the most attractive investment destinations on the continent. This underscores SEIFSA’s view that despite the headwinds that the economy has faced in the recent past, opportunities remain abound. It will be incumbent on South Africa to capitalise on this and many other positive outcomes
For further information please visit: www.seifsa.co.za
