Donald Gasper

The View | Can the BRICS form a wall to counter the damaging effects of US trade protectionism?

Donald Gasper says a discussion of US trade policies is likely to dominate the ongoing BRICS summit but the five countries must forge closer ties to be an effective global force

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China’s President Xi Jinping (left) walks with South African President Cyril Ramaphosa after a joint press conference at the government’s Union Buildings in Pretoria, South Africa, on July 24. Xi is in the country to attend the three-day BRICS Summit in Johannesburg. Photo: AP

Donald Gasper

Published: 11:30am, 26 Jul 2018Updated: 10:23pm, 26 Jul 2018

The threat of a global trade war is at the top of the agenda of the summit of the five BRICS nations that opened in Johannesburg on Wednesday as tensions escalate over tariffs and trade and a surge in unilateralism and protectionism led by the United States.

The acronym BRIC was first suggested in 2001 by former chairman of Goldman Sachs Asset Management Jim O’Neill as a way to group together Brazil, Russia, India and China, nations at a similar stage of development that in his view promised to become the economic powerhouses of the future. South Africa joined this loose grouping of emerging economies nine years later, leading to the new name BRICS – a move criticised by O’Neill on the grounds that its economy was smaller than that of Nigeria and its growth rate was too low.

Jakkie Cilliers, the head of the African Futures and Innovation Programme at South Africa’s Institute for Security Studies, told Deutsche Welle recently that economics isn’t everything. “It’s also about foreign policy orientation and the domestic situation in the respective countries.”

This month’s summit, which marks the 10th anniversary of the formal establishment of the grouping, takes place in South Africa, which this year holds the presidency of BRICS. The resource-rich country is a key to solving the growing energy deficit of India and China and it has proved itself to be an excellent gateway to Africa for the other BRICS members.

The latest US trade policy could give the group renewed momentum, analysts say. “Trade agreements between associations of countries like BRICS have become increasingly important, given the self-seeking, and ultimately short-sighted, barriers to trade that are being instigated by the US,” Kenneth Creamer, an economist at Johannesburg’s Wits University, told AFP.

The official theme of the summit is “BRICS in Africa: collaboration for inclusive growth and shared prosperity in the 4th Industrial Revolution”. However, according to Maxim Oreshkin, Russia’s economy minister, much of the discussion is likely to focus on how to react to the latest US policies.

At a meeting of their finance ministers earlier this year, the BRICS nations agreed to “fight against trade protectionism together”.