martedì 30 ottobre 2018

What role do the BRICS countries play in international relations?

Good summaries and information to start with:

The BRICS is an international political association of leading emerging economies, arising out of the inclusion of South Africa in the BRIC group in 2010. As of 2018, its five members are Brazil, Russia, India, China and South Africa. With the (partial) exception of Russia, the BRICS are all developing or newly industrialized countries (often called ‘emerging markets’ or ‘emerging economies’, although at this point China, for example, has clearly emerged!) with very high growth rates between the end of the 1990s and 2010. They have large and till recently fast-growing economies and significant influence on regional and global affairs. As of 2018, the five BRICS countries represent 25 % of the world’s land area, 41.7% of its population ( 3.23 billion, but mainly China and India),
45 % of its workforce, and in 2017, according to IMF estimates, had a combined nominal GDP of $18.31 trillion (compared with US nominal GDP of $19.36 trillion), just over 24% of nominal world GDP (about 30% in GDP PPP terms, $41 trillion) a figure which is expected to continue to rise, although estimates seem to vary a lot. Their share of nominal global GDP trebled in 15 years. In 2015 they also accounted for around 55% of the output of emerging and developing economies, and had an estimated $4.4 trillion in combined foreign reserves (mainly China). The BRICS accounted, on average, for 56% of the growth of global GNP (at 2005 $PPP) during 2008-17. However intra-BRICS trade flows are considered low at only 4.9% of the total foreign trade of these countries.
https://developingeconomics.org/2017/09/27/the-brics-and-a-changing-world/
IMF estimates of GDP, nominal and PPP per member for 2017 were: China $11.9 trillion nominal and $23.1 trillion PPP, Brazil $2.1 trillion and $3.2 trillion, Russia $1.47 and $4.0 trillion, India at $2.4 trillion and $9.4 trillion, South Africa $0.3 trillion and $0.76 trillion. Compared with the United States $19.4 trillion nominal and $19.4 trillion PPP, European Union $17.1 trillion nominal and 20.8 PPP.
However, according to the IMF per capita GDP nominal and PPP for 2017 was reported as: China $8,583 nominal and $16,624 PPP, Brazil $10,019 and $15,000, Russia $27,248 and $27,890, India $1,852 and $7,174, South Africa $6,089 and $13,403 (compared with US $59,495 nominal and $59,495 PPP).http://en.wikipedia.org/wiki/BRICS
https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29
https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29
https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29_per_capita
https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29_per_capita
http://in.reuters.com/article/2013/03/26/brics-summit-factbox-idINDEE92P09120130326
http://www.treasury.gov.za/brics/sbe.aspx
http://www.mni-indicators.com/files/focus_on_brics_economic_growth.pdf
Their economies are said to be complementary rather than similar, since China and India are industrial and service producers, while Russia and Brazil are major energy and raw materials suppliers. Russia is also a major grain exporter. However, economic complementarity is limited by the low level of intra-BRICS trade mentioned above. Clearly their percentage of global GDP is likely to continue to grow in the long term, although other developing countries may achieve even faster growth rates. The BRICS group may expand its membership in response to this.http://articles.economictimes.indiatimes.com/2012-09-06/news/33650208_1_bric-countries-brics-share-punita-kumar-sinha
http://www.cfr.org/brazil/brics-summit-delhi-declaration/p27805
As we have seen, given their enormous populations the BRICS have relatively low average per capita income (particularly India) with large numbers of people still living in poverty.
According to OECD figures, with easy credit, rising commodity prices and favorable demographics (i.e. cheap labor) the BRIC(S) economies grew at a rapid pace from 2001 to 2010. In 2010, while central banks in developed markets were printing cash and lowering interest rates to breathe some life into their sluggish economies, Gross Domestic Product in Brazil, Russia, India, and China, expanded by 7.5%, 4.5%, 10.5% and 10.4% respectively.
However, the BRICS were eventually hit by the economic crisis of 2008 as it reduced demand in developed economies. GDP growth rates for 2015, 2016, 2017, 2018 according to the IMF were Brazil -3.8%, -3.4%, 0.7%, 1.4% Russia -2.8%, -0.2%, 1.8%, 1.7% India 8.0%, 7.1%, 6.7%, 7.3% China 6.9%, 6.7%, 6.8%, 6.6% and South Africa by 1.3%, 0.3%, 0.7%, 0.8%. So China’s growth has cooled significantly from the double digits rates of previous years. India is still doing well. South Africa is growing at a very modest rate. However, Russia and Brazil have been in serious difficulty till very recently and went through recession, due to falling oil and commodity prices and inflation (15.8% in Russia in August 2015, but down to 4.5% in September 2018, and 9.5% in Brazil in August 2015, down to 4.5% in September 2018). Interest rates in Russia stood at 7.5% in September 2018 and at 6.5% in Brazil in the same period. Russia is also facing sanctions from the US and EU and other countries as a result of the Ukraine crisis. A recent rise in oil prices has been good for Russia (bad for China) but this should stabilize in 2019. Commodity prices for food and raw materials should remain fairly stable across 2018-19 unless new tariffs lead to a trade war. So because of these political factors the outlook for commodity prices, exports, imports and GDP growth is highly uncertain.
All this, except for India, is in contrast with previous performance over the last 20-25 years:
Average GDP growth in the past:
Russia 3.6% (1996-2015), India 6.01% (1951-2015), China 10.92.% (1989-2015), South Africa 3.03% (1994-2015), Brazil 3.01% (1991 to 2015).
However, according to many sources, prospects for the BRICS’ future long-term growth, appear good and, compared with many of the most developed economies, two of the BRICS, China and India, are still doing very well. (We will need to see if significant long-term gaps in growth rates open up between the BRICS members.) Moreover, if their economies slowed down simply as a result of the world recession and if the global economy continues to recover, their growth rates may return to previous levels. On the other hand, some experts argue that they may face real challenges relating to structural problems within their domestic economies and political systems. See:
http://time.com/4923837/brics-summit-xiamen-mixed-fortunes/
https://personal.vanguard.com/pdf/ISGBRIC.pdf
and the longer articles from Foreign Affairs cited at the end of this post.
We should also note that some other developing economies may out-perform the BRICS in terms of rapid GDP growth over the next decade. There is the ‘N 11’ group, the ‘Next Eleven’, Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea, and Vietnam according to Goldman Sachs. However, they too now face seruous economic problems.
There are also the TIMPS, Turkey, Indonesia, Mexico and the Philippines, a group which in 2010 was beating the BRICS by almost every economic measure. There are also the MINTs, an acronym coined for a group of four countries—Mexico, Indonesia, Nigeria and Turkey Will such countries be invited to join the BRICS group at some point or are they in competition with the group’s members? Will they really be able to sustain GDP growth? The BRICS Plus initiative seems to suggest that the BRICS group could soon expand
At all events, the BRICS group is here to stay and clearly represents a growing movement towards a more multipolar world economic order and since the BRICS summit in New Delhi in 2012 various goals have been outlined.
The reform of global economic governance – They want to move forward with the revision of the quota mechanism for governance of the World Bank and IMF in order to reflect the growing economic weight of developing countries and emerging markets.
Trade and Development – They would welcome a new global reserve currency as an reliable alternative to the dollar. This might be a cryptocurrency:
For the moment they also want to boost intra-BRICS trade using their own currencies (instead of dollars) in order to compensate for any drop in demand due to a global future recession or falling US/EU demand (and protect their national currencies from financial crises), and to link up their stock markets.
In 2012, they examined the idea of setting up a new development bank, whose aims would include funding development and major infrastructure projects initially in BRICS countries, but later in developing and least developed countries too; lending, in the long term, during global financial crises such as the Eurozone crisis; and issuing convertible debt, which could be bought by the central banks of all the member states and hence act as a means of risk-sharing.
Foreign policy – In 2012 at theNew Delhi summit, then President of China Hu Jintao described the BRICS countries as defenders and promoters of developing countries and a force for world peace. At the summit the BRICS criticized the West’s pressure on Iran and its attempts to convince other countries to restrict their trade with Iran, and said that dialogue was the best way to resolve the nuclear question. The group took a similar position on Syria, against military intervention, and in general emphasized the dangers of a war in the Middle East and the fact that it would immediately lead to a rise in oil prices. The deal with Iran was welcomed by the BRICS but Russia itself moved to intervene in Syria.
AT the BRICS summit in Durban in March 2013, further progress was made with the approval of the plans to create development bank. Russia, Brazil and India agreed to contribute $18 billion to the BRICS currency reserve pool, China $41 billion and South Africa $5 billion.)
At the July 2014 sixth BRICS summit in Fortaleza, Brazil the group signed a document to create the $100 billion funded New Development Bank (NDB) and a reserve currency pool worth an additional $100 billion to help make currency transaction more diversified, stable and predictable and to act as “a kind of mini-IMF”. The NDB opened in July 2015. The NDB’s headquarters are in Shanghai, the institution's first president is from India, the bank's first regional office is in Johannesburg, the inaugural chairman of the board of governors is from Russia and the first chairman of the board of directors is from Brazil. The presidency, with a term of five years, will rotate among the members of the BRICS.
However, the BRICS’ NDB may be overshadowed by the other new Chinese-based multilateral lender, the Asian Infrastructure Investment Bank (AIIB), which is headquartered in Beijing. China is its biggest shareholder with about 30%, according to the legal framework signed by 50 founding member countries. It opened for business on 16 January 2016 . Major European and Asian economies, including Germany, Italy, Britain, France, Russia, Australia, and South Korea have joined the AIIB, but the US and Japan, two of the world’s largest economies, have declined to do so. Some Chinese leaders have also talked of the need to prepare for a 'de-Americanised' world economy. However, Chinese Finance Minister Lou Jiwei played down the competitive aspect (2015). And prospects for cooperation between the banks seem good
The new banks can offer an alternative to the World Bank, the International Fund and the Asian Development Bank and can be seen not as competition to the existing system but as complementary and a way for China to reinvest productively some its vast $4 trillion foreign-exchange reserves. In 2017 the NDB moved ahead with 4 projects in China, Russia and India with loans totalling more than $1.4bn. The scope of the NDB’s activities includes renewable energy, information technology, energy conservation, flood control, water quality and developing the rural drinking water supply. Going forward, another $30bn in loans, including a total of 15 projects by the end of 2017 and up to 50 in 2021, has already been announced.
https://www.ft.com/content/cc7c7ee6-918b-11e7-a9e6-11d2f0ebb7f0

The 2015 BRICS summit was held in the Ufa in Russia.The summit coincided with the entry into force of constituting agreements of the New Development Bank and the BRICS Contingent Reserve Arrangement

The 2016 BRICS summit was held from 15 to 16 October 2016 in Goa, India. It condemned terrorism, recognised the difficulties for the group created by the global recession and underlined the importance of cooperation with and work within traditinal global institutions like the WTO.
There was some controversy over the issue of terrorism.
The 2017 BRICS summit in Xiamen, China helped to reduce tensions between China and India over the Doklam border issue.
The summit approved a three-year action plan (2017-2020) for cooperation innovation and agreed to promote the development of BRICS Local Currency Bond Markets and jointly establish a BRICS Local Currency Bond Fund, as a means of contribution to the capital sustainability of financing in BRICS. The BRICS grouping continued to push for cautious reform of global order but in its final declation made it clear that it did not wish to weaken the institutions of the international order and reaffirmed the BRICS' commitment to the UN and the G20, globalization, sustainable development and the fight against climate change.

The 2018 BRICS summit in Johannesburg, South Africa released this declaration
and Chinese President Xi Jinping said:
“It is important that we continue to pursue innovation-driven development and build the BRICS Partnership on New Industrial Revolution (PartNIR) to strengthen coordination on macroeconomic policies, find more complementarities in our development strategies, and reinforce the competitiveness of the BRICS countries, emerging market economies and developing countries.”
He also discussed the BRICS Plus initiative.

So do the BRICS represent a fundamental change in the world order either today, or in the near future or in the long term?
No one doubts that the influence of these countries will continue to grow. After all, as emerging economies, their growth rates were much higher than those the developed economies averaged over most of the last 20 years and although some of them face economic difficulties now their prospects for the long-term future remain good. So the real question is whether Brazil, Russia, India, China and South Africa form a coherent group with a coherent set of interests which are clearly opposed to those of the traditional ‘West’ or not. In other words are all of these countries really outside the ‘West’ if we do not restrict the meaning of the term ‘West’ to a synonym for NATO or fully developed economies? Are they a challenge to the West’s leadership, or will all or some of these countries simply become an integral part of it?
Much of what the BRICS aim to do with regard to trade and development, as outlined above, should simply be welcomed by the West and the UN. Many Western NGOs and UN agencies have been working towards these development goals for decades, but with limited resources. A new reserve currency alongside the dollar would make the international financial system more stable, and the creation of the New Development Bank should provide a way for countries like China to reinvest their surpluses in various local and global projects and provide a further global lender of last resort. How realistic all this is in the short term is, however, less clear given the structural weakness of the Russian and Brazilian economies and the fears about China's debt.
Population trends within the BRICS also differ significantly. The population of China continues to grow, but slowly (0.5% per year 2016) and is predicted to reach 1.45 billion in 2030 and then to go into decline with an already aging population.
India’s population is youthful and expanding at 1.1% (2017) annually and will probably overtake China as the world’s most heavily populated state by 2024.
Brazil’s population growth rate was also high in previous years but fell to 0.80% in 2013 and has remained there (2017). Meanwhile the population in South Africa grew by I.2% in 2017. After the break-up of the Soviet Union Russia’s population fell significantly for more than a decade but has now started to slowly recover, 0.1% in 2017.# These trends impact GDP growth rates and social welfare costs in the future, making forecasts difficult to make and suggesting growing divergence among the members of the group.
Commentators also point out that there are already real differences and potential divisions and weaknesses among the group’s members which will inevitably affect the coherence and effectiveness of the group in responding to any particular issue, and the ultimate objectives of each of its members. Here are a few of them:

Russia and China are permanent members of the UNSC with veto power. They initially did not seem in a hurry to support India, Brazil and South Africa with more than words in any bid to obtain permanent seats on the Council and do not support attempts to reform the SC by eliminating or reducing the scope of the veto power.
The Durban Declaration included this sentence:
“In this regard, China and Russia reiterate the importance they attach to the status of Brazil, India and South Africa in international affairs and support their aspiration to play a greater role in the UN.”
This seemed to stop short of unconditional support for seats on the UNSC for Brazil and India, but in August 2015 Russia finally expressed clear support for permanent seats for Brazil and India:
The BRICS Xiamen summit declaration in 2017 stated that "China and Russia reiterate the importance they attach to the status and role of Brazil, India and South Africa in international affairs and support their aspiration to play a greater role in the UN."
Rusia and China do not support the extension of the veto to India and Brazil.
Would this now be acceptable to the G4?

However, Russia now clearly supports India's bid for a permanent seat in UN Security Council.

China is more ambivalent since India's bid is linked to Japan's in the G4.

https://economictimes.indiatimes.com/news/defence/indias-unsc-alliance-with-japan-biggest-mistake-chinese-media/articleshow/49042814.cms
However, it seems likely that Russia and China will continue to use their position and their vetoes primarily to forward their own interests, as they perceive them, rather than the interests of the BRICS or the interests of the majority of developing nations in the General Assembly. For example, from the start of the Syrian civil war in 2011 China and Russia were ready to block any resolution on Syria by the SC, like that proposed by the Arab League in Feb. 2012 and approved by the UNGA by 137 votes to 12 with 17 abstentions, which could open the door to outside intervention or simply called for the current regime to step down. In contrast, when Russia decided to launch its own air strikes into Syria in September 2015, at the invitation of President Assad, it is not clear if it first informed and coordinated its action with its BRICS partners and sought approval from them. Russia has used its veto to block criticism of the Assad regime or of its own intervention. Currently China also supports some form of intervention and says it is cooperating with both Russia and the US.
Brazil’s former President Rousseff criticized Russia over its intervention in Syria in Oct 2015.
India accepts Russia’s intervention but argues that any long-term solution must be political.
China is, of course, a one-party state with regional ambitions, perceived as a threat by several of its democratic and non-democratic neighbors who have turned to the US for support. Russia is, although formally a democracy, an authoritarian state and one with substantial military power. By contrast, Brazil, India and South Africa are all functioning (or dysfunctional!) democracies, with a variety of problems relating to the very poor, but sharing many ‘Western’ values. India has border disputes with China and is also involved in the dispute over the status of Tibet (a ‘domestic’ Chinese issue for the Chinese, as is Taiwan). So while the BRICS appear to represent a calming force in international relations, in favor of conflict resolution through dialogue and against military intervention and regime change, something that the West, or at a least large section of Western public opinion, probably welcomes after the long and costly campaigns in Iraq and Afghanistan, it is not clear that this respect for every nation’s sovereignty will be universally accepted and approved of by public opinion around the world, by all the members of the UNGA and by public opinion within the democratic BRICS themselves. Humanitarian intervention remains a subject of heated debate within, as well as between countries, experts and ordinary people. Some argue that a situation like Syria requires international action. Others argue that the humanitarian costs of intervention may easily outweigh the gains. Given Russia's intervention in Syria it would be an oversimplification to see this as a division between an aggressive NATO and a peaceful BRICS. Opinion in the West was always divided over the non-UN mandated operation in Iraq, but also over the UN-mandated interventions in Afghanistan and Libya. At present it is the BRICS who seem out of step with opinion in the Arab world and the General Assembly on Syria, while the West seems out of step with opinion in the GA on the Palestinian problem. Now that Russia has intervened in Syria it will be interesting to see the reaction of its BRICS partners and the level of cooperation between Russia and France (after the Nov. 2015 terrorist attack on Paris), the EU, the US and other Western countries.
Each of the BRICS also faces serious domestic challenges (mainly relating to inequalities of wealth and widespread poverty) and there are also rivalries between them and varying economic and political performances
https://www.weforum.org/agenda/2016/04/what-is-the-state-of-the-brics-economies/
and these, together with growing regional commitments may take precedence over aspirations to play a more global role in international relations. For example, Brazil in 2015 saw widespread protests by the poorest sections of society, with people saying that they had not benefited from GDP growth, that money had been wasted on the Olympics and World Cup and calling for the government to do something about economic inequalities and widespread bribery and political corruption. This scandal led to the impeachment of President Dilma Rousseff in 2016, the arrest of former President Lula and contributed to the election of Jair Bolsonaro as President in October 2018, a candidate whose right-wing rhetoric has proved divisive.
https://www.theguardian.com/world/2018/oct/28/jair-bolsonaro-wins-brazil-presidential-election
Meanwhile South African President Jacob Zuma, faced with a debt crisis, and corruption and cronyism scandals was forced to resign in February 2018. https://www.theguardian.com/world/video/2018/feb/14/jacob-zuma-south-africas-scandal-struck-president-resigns-video
Meanwhile, some commentators argue that the change in the world order is really a result simply of the rise of China (or at most China and India) rather than the BRICS as a whole.
Finally, one should note that the BRICS are not really like the old Communist bloc, which defined itself by its opposition to the West and to capitalism. (Perhaps politically it has been more similar to the old Non-Aligned Movement of the Cold War period, of which India was a member – at least until Russia’s increasingly proactive foreign policy). Economically, there is no clear division between the ‘West’ and the BRICS. In both groups we find a range of approaches to managing the economy, those that adopt a more free market approach, those that belief in government supervision and those that believe in a welfare state – and varying proportions of all three. Politically, as with the rest of the world, the BRICS countries have their national interests and will no doubt seek to protect them, but there is no basic ideological division between the West and the BRICS. (China is hardly recognizable today as a ‘Communist’ state in terms of economic policy). China and Russia are authoritarian states but they are part of an international community based fairly solidly on Western liberal democratic values that they do not wish to challenge publicly (although they may violate them) and which shows no real signs of losing its appeal to the majority of people around the world. Brazil, South Africa and India are active supporters of this community’s values. In fact, one might hope that both Russia and China will conform to those values in the long term, evolving slowly towards a more democratic and rights-based society. Thus a more multipolar world with a more diffuse leadership does not necessarily mean a weaker West, but perhaps simply a more inclusive and wider definition of that idea. Alternatively, we may see the BRICS acting together on crucial economic issues, and also negatively to block, discourage or restrain what they perhaps see as Western adventurism as regards military interventions (for humanitarian purposes) in other countries, but much less able to agree a positive, proactive line in foreign policy due to their different political systems. Their cooperation could prove valuable in areas where US involvement has been reduced or ended by President Trump, for example in supporting the Paris Climate Change agreement and in efforts to save the Iran deal.

See: 'Russia and India also underlined the importance of the full and effective implementation of the Joint Comprehensive Plan of Action (JCPOA) on the Iranian nuclear programme in order to support international peace and security, to strengthen non-proliferation regime and to develop normal economic cooperation with Iran.'
from

in 2018, the population of Russia is 146,270,033.
The population hit a historic peak at 148,689,000 in 1991, just before the breakup of the Soviet Union, but then began a decade-long decline, falling at a rate of about 0.5% per year due to declining birth rates, rising death rates and emigration. The decline slowed considerably in the late 2000s, and in 2009 Russia recorded population growth for the first time in 15 years, adding 23,300 people. Key reasons for the slow current population growth are improving health care, changing fertility patterns among younger women, falling emigration and steady flows of immigrants from the ex-USSR countries.
https://en.wikipedia.org/wiki/Demographics_of_Russia#Population_statistics
With the 2014 annexation of Crimea by the Russian Federation in a move condemned by many countries as illegal Russia occupied additional territory with 1,965,200 inhabitants. New citizenship rules allowing citizens of former Soviet countries to gain Russian citizenship have gained strong interest among Uzbeks. So the population could return to levels seen just before the breakup of the Soviet Union as well as resolve problems of statelessness.

The future
Other sources and older material as background:
for the group without South Africa
then
Three old longer articles from Foreign Affairs as background:



Pubblicato da alle

Nessun commento:

Posta un commento

Nota. Solo i membri di questo blog possono postare un commento.

Iscriviti a: Commenti sul post (Atom)