Information Bulletin of the BRICS Trade Union Forum
Issue 28.2019
2019.07.08 — 2019.07.14
International relations
Foreign policy in the context of BRICS
Adding 'T' to BRICS: A NATO Ally in Transition (Добавление «Т» в БРИКС: союзник НАТО в переходный период) / United Kingdom, July, 2019
Keywords: expert_opinion, brics+
United Kingdom

Ever since Turkish President Recep Tayyip Erdogan personally attended the 10th BRICS summit in Johannesburg in 2018, many scholars of political science from Turkey and a host of others from around the world have been caught up in a lively discussion about Turkey's ever-increasing aspirations to become a permanent member of the grouping. Much of the debate has centered around the material incentives for Turkey's desire to add a T to the BRICS grouping, such as various economic and military benefits, reducing dependence, and multilateral foreign policy options. For instance, Gokhan Bacık argues that because Turkey stands as a typical emerging regional power in its own capacity in the Middle East and this makes it –at least theoretically — eligible for membership: "When it was the BRIC, Turkey was not of the scale of its members. Compared with each of the original states, Turkey is not a same-level big power. However, South Africa's membership displayed that an African country with a lower degree of hard-power capacity was acceptable to the BRIC" (Bacik 2013, 766). Yaşar Yakış, a political scientist and a former Turkish foreign minister, similarly argues that Turkey would be a good candidate for the BRICS grouping's first trial expansion because it is "a great middle-size country, not very poor, not very rich, something in the middle" (Yakış, July 31, 2018). Jayshree Sengupta sees a possible Turkish membership as a mutually beneficial move. She argues that a membership will give Ankara access to infrastructural development loans from the AIIB and the NDB, while expanding the BRICS' influence due to Turkey's strategic location and unique identity and relationship with the West and the Muslim world (Sengupta, August 13, 2018). Moving the discussion even further, Ziya Öniş and Mustafa Kutlay classify Turkey as a "near-BRIC power," which refers to Ankara's "increasingly assertive and independent style of foreign policy with aspirations to establish itself as a major regional actor." (Öniş, Kutlay 2013, 1409).

This paper attempts to analyze Turkey's ever-increasing aspiration to become a member of the BRICS grouping by seeking answers to three major questions: 1) Why does a traditional NATO and Western ally with a decades-long agenda to become an EU member increasingly aspires come a full-fledged member of a grouping that arguably presents a challenge to the existing global order? What would be the pros of a possible Turkish membership in the BRICS grouping? Would BRICS members be willing to add T to BRICS?

The first potential benefit of a BRICS status for Turkey would be an increase in its position in the world system. We argue that Turkey would gladly bandwagon the BRICS club for similar reasons that of the other members: to punch beyond its weights on international and regional issues. The second potential benefit is economic. BRICS membership would help Turkey greatly in its desire to revisit its economic dependence on the West, the EU in particular. It would also contribute to Turkey's export trade greatly. And finally the third potential benefit is ontological. Ankara's desire for BRICS membership can partly be seen as an engagement in tactics of shame avoidance, "both retrospective – making up for past misdeeds — and prospective – avoiding future misdeeds" (Mitzen, Larson 2017, 8).

The following section elaborates on the BRICS consortium – what does the BRICS mean? – and on Ankara's ever-increasing aspiration to become a member. Utilizing mostly secondary sources, the third section then attempts to understand the puzzle of why a traditional Western ally increasing desire to become a member of the most prominent non-Western grouping. What would be the pros and cons of a possible Turkish membership in the BRICS grouping? The final section seeks an answer to whether BRICS members would accept Turkey as an equal partner in the bloc.

Turkey: Fit for Membership in the Club?

Despite periodical ups and downs due to domestic, regional and global developments, from the very beginning, Turkey's core material and ontological security interests have remained inextricably with the Western world for decades. For Kemal Atatürk, the founder of the Republic, and his narrow elitist circle, later known as the Kemalists, there existed only one and only true civilization; European civilization. Ankara initially joined the League of Nations in 1938, and then become a founding member of the UN in 1945. With the beginning of the Cold War, Turkey openly sided with "the free world and the Western Bloc" by becoming a member of NATO in 1952. Also, joining the EU has always been the most significant goal of the country since late 1950s. Ankara applied for a membership to the EU for the first time in 1959. And after almost 50 years, the EU finally agreed to start access negotiations with Turkey in December 2004. However, there is now an ever-increasing favoring of the BRICS grouping and a rise in anti-Western sentiment in Turkey's contemporary foreign policy. This has been more and more evident ever since Turkish President Erdogan personally attended the 10th BRICS summit in Johannesburg last year. We argue that there are three main reasons behind this: economic, political and ontological.

In the most simple terms possible, the BRICS is a heterogeneous club of states composed of five major emerging countries – Brazil, Russia, India, China, and South Africa. These five countries share significant structural features and enjoy rapidly growing economies, significant military capabilities, substantial populations, and increasing political representation and participation in all global governance institutions (Thakur 2014, 1794-1795). Yet, the grouping is still far from being an EU-like coherent organization as it lacks the minimum legal and institutional features. Perhaps save for South Africa, BRICS grouping consists of some of the largest countries in terms of land area, population, economic and military capabilities and demographic scales. Turkey, in terms of GDP, share of global output, and military expenditure, is positioned ahead of South Africa with an undeniably large gap with the rest of the members of the club. If Turkey was a member, it would rank 5th in GDP analysis, in military spending and population and in its share of global economic output. It has a relatively large and growing population with over 80 million people, and its conventional army with 515,000 active troops and an additional 380,000 reserves, is the second largest standing military within NATO. Most scholars accept Turkey as an emerging regional (middle) power based on the country's advancement in economic development, and its arguably increasing soft power in global politics (Benhaïm, Öktem 2015). However, despite its relative economic and diplomatic success, in terms of material capabilities, Turkey has only managed to position itself "in the middle of the MIKTA grouping," largely behind South Korea, and Indonesia (Gök, Karadeniz 2018, 7). It is therefore only natural for Turkey to remain far below the BRICS members in terms of material capabilities.

The BRICS grouping is not an institutional organization. Therefore, there is no concrete roadmap for the economic and political conditions that need to be fulfilled for accession. The decision of accession is solely taken by the representatives of all the member countries of BRICS. It is therefore a difficult task to analyze whether Turkey fits into the BRICS standards. However, given the admittance of a middle power like South Africa, it is safe to argue that the club may open its doors to other Middle powers like Turkey, Mexico and Indonesia. The candidate must be an emerging, newly industrialised country with a growing economy and increasing political influence on regional and perhaps global affairs to a certain extent – but this is of course a very vague measure.

Adding T to BRICS: What Would Be the Costs and Benefits?

"Turkey is a European country, an Asian country, a Middle Eastern country, Balkan country, Caucasian country, neighbor to Africa, Black Sea country, Caspian Sea, all these" (Grossman 2010).

This section attempts to answer the following questions: Why does a traditional NATO and Western ally with a decades-long agenda to become an EU member increasingly aspires to become a full-fledged member of a grouping that arguably presents a challenge to the existing global order? What would be the pros and cons of a potential Turkish membership in the BRICS grouping?

The first potential benefit of the BRICS membership for Turkey would be an increase in its position in the world system. Unfortunately, such a prediction is doomed to suffer from a lack of an empirical evaluation. However, it would be safe to argue that Turkey would gladly bandwagon the BRICS club for similar reasons as of the other members: to punch beyond its weights on international and regional issues. It is no secret that South Africa rushed under the club's umbrella […] "to entrench its claim to continental leadership. (Brütsch, Papay 2013, 304). Similarly, joining the BRICS has bolstered Brazil's soft power credentials significantly. Delhi is using the club to "exact the international respect it thought it deserved" (Brütsch, Papay, 303-304). And the grouping offers Russia an opportunity to "participate in an economic bloc in which it had a nominally equal status" (Johnson, Kösten 2016, 209).

Although, Turkey has historically been a close ally of the Western bloc, the US in particular, it has increasingly been marginalized and "pushed aside" by the West, the US and the EU in particular (Yakış 2018). And this process, perhaps unsurprisingly, goes hand in hand with Ankara's increasing alienation from the strictly Western-oriented policies it pursued during the Cold War and the 1990s. The period that started in 2002 with the incumbent AKP government's rise to power, which continues today, is often defined as an era in which neo-Ottomanism reached its peak in both sociocultural and foreign policy context. Ankara's neo-Ottomanist political ideology largely aims to set Turkey as a "benign regional power, especially in the Middle East, North Africa and the Balkans" (Öniş, Kutlay 2013, 1411). As part of a search for an increased role in regional and global system, Ankara not only undertook many initiatives to become part of international institutions and increase Turkey's visibility in global platforms (Gök, Karadeniz, 6-7), but also engaged in a process of investment in countries from Latin America to sub-Saharan Africa, such as building mosques, education facilities, financing religious education, and providing humanitarian aid – especially in Somalia (Tol 2019). Turkey's neo-Ottomanism also paved the way for a new strategic thinking in the relations with the West "that is based more on cost–benefit calculations than on identity‐related factors" (Oğuzlu 2008, 5). Turkey's negotiations with the European Union for a possible membership are at a certain deadlock, and disagreements between Ankara and the West, the US in particular, are becoming more and more visible on many critical issues. Turkish officials have gradually come to understand that Ankara's institutional relations with NATO and the EU "does not automatically suggest that Turkey is a part of the Western international community and that following a Western‐oriented foreign policy always serves Turkey's interest" (Oğuzlu, 6). However, this realization does not necessarily mean a certain breakup with the West. Rather it makes Turkey a "soft-revisionist" state with an agenda to reform the existing international order into a more democratic and inclusive order. A potential BRICS membership therefore can easily be seen by the Turkish officials as a prestigious step for Turkey's efforts to consolidate its emerging regional power status. It is also "a short cut to satisfying" Ankara's increasing lust for a more autonomous foreign policy and less dependence on the West (Bacik, 769).

The second potential benefit of a BRICS membership for Turkey is economic. It is safe to argue that BRICS status would contribute to Turkey's export trade greatly. In 2000, Ankara's export trade with BRICS stood at just 3 % of the total export, and 11 % of the total import (Dinçer 2015, 3). Its export share rose to 8.4 % in 2013 while the import share reached 23 % in the same year (Dinçer, 3). Turkey's export share grew only around 5 % while import share grew around 12 % in thirteen years. When looked at the South African example, one sees a very different upward trend. Before its accession to BRIC, the country's export trade with the member countries were at only 6.2 % of the total export (Anuoluwapo et al., 2018, 31). However, when South Africa became a member in 2010, its export to the BRIC grew to 16.8 per cent and further rose to 29 per cent by the end of 2011" (Anuoluwapo et al., 31-32). It can hardly be argued now that Turkey's post-membership situation would be very different than that of South Africa.

A BRICS status would also help Turkey greatly in its desire to revisit its economic dependence on the West, the EU in particular. No BRICS countries are currently in Turkey's top 10 export countries list, which is heavily dominated by Germany, UK, USA, Italy and France. And China, perhaps unsurprisingly, is the only country to find a place in Ankara's top 10 import countries list. However, despite strong reactions from the EU and the US, Turkey increasingly attempt to create economic and foreign policy alternatives. For instance, to combine China's Belt and Road Initiativewith Turkey's Middle Corridor Project, a "memorandum of understanding" was signed between Ankara and Beijing in 2016 (Turkish FM 2016). Ankara's goods and services trade with Bejing was around $24 billion in 2017. Chinese investments in Turkey is currently around $2 billion in total (Turkish FM 2016). Based on the post-membership South Africa example, it is safe to argue that a membership for Turkey would promote further developmental programmes, investments and infrastructure within the country, and strengthen Ankara's decades-long desire to act as a multilateral actor as both Middle Eastern country, a Western country, and finally a BRICS country.

A BRICS status would also offer Turkey a technology partnership, especially in term of military assistance. Ankara has already agreed to purchase S-400 surface-to-air missile defense systems from Russia. If deployed, the missile system will make Turkey the first NATO member to deploy the system on its soil (Ülgen 2019). If granted a membership, Chinese and Russian suppliers would increasingly support Ankara with new military technology and co-production ventures.

The third potential benefit of a BRICS membership for Turkey is ontological. Turkey has long been struggling with its geographical belonging. Is it a country that belongs to the West? Or the Middle East? Partly to reinvent its sense of self, Ankara applied for a membership of the European Union ( the then European Economic Community) back in 1959. After 50 years, the EU finally agreed to start access negotiations with Turkey in December 2004. However, decades-long efforts by a series of Turkish governments have eventually entailed a deep Western-fatigue, triggering a need for Turks to reconsider their "sense of self." The Ontological Security Theory (OST) in international relations predicts that when such an ontological insecurity emerges, "surprising foreign policy choices are made in order to avoid anxiety, shame or both" (Mitzen, Larson, 8). Even though it looks irrational for a traditional NATO, and Western ally to become member of the BRICS club, such a membership would entail Ankara's biographical continuity. Put differently, efforts by Ankara can partly be seen as an engagement in tactics of shame avoidance, "both retrospective making up for past misdeeds – and prospective – avoiding future misdeeds" (Mitzen, Larson, 8).

Would the Existing Members Be Willing to Add T to BRICS?

In a 2005 Paper, Goldman Sachs argued that countries like Turkey and South Africa were too small for BRIC status (O'Neill 2005, 4). The paper also argued that among the eleven countries that are considered emerging markets with the potential to play significant roles in the global economy – Bangladesh, Egypt, Indonesia, Iran, Korea, Mexico, Nigeria, Pakistan, Philippines, Turkey and Vietnam, – only Mexico and South Korea had the potential for membership. However, South Africa's accession in 2010 as the smallest member of the club tells us that the BRICS grouping may be open to middle-sized countries. Economic-demographic stature and hard-power capability may not be the main conditions for BRICS status, yet they remain important determining pillars.

There are already some positive signs from the BRICS members for a possible expansion. First of all, President Erdogan's attendance to the 10th BRICS summit was not "by accident," according to Pule Malefane, the South African Ambassador to Turkey (Sevinç 2017). Rather, Erdogan was invited by its members because "Turkey is viewed as a strategic partner and a leader in the region," as well as a reliable actor that works to strengthen South-to-South relations and Agenda 2063, a strategic vision of the African Union (Sevinç 2017). Indeed, Turkey is a leading trade partner, as its trade with South Africa forms around 40 percent of its total trade with rest of the sub-Saharan African states (Ndzendze 2018).

It is also known that China launched an initiative to create a BRICS+ circle in an attempt to enhance cooperation with other developing countries. In 2017, former Chinese foreign minister, Wang Yi, revealed China's desire to expand the core with five regional blocs, representing a total of 35 countries: "We will widen the circle of friends of the BRICS and turn it into the most influential platform for South–South cooperation in the world" (Lissovolik, Vinokurov 2019, 3-4).

There's now also a very positive trend in the relations between Ankara and Moscow. The two countries are increasingly becoming entwined in trade and defense. In 2018, the project of Turkey's first nuclear power plant was granted to Russia's Rosatom under a build-own-operate scheme. Also, an agreement that was signed between the Turkey Wealth Fund and the Russian Direct Investment Fund created a Russian-Turkish investment fund "with €900 million in joint reserve capital" (Frantzman 2019). Therefore, a BRICS status for Turkey can be viewed by Moscow as a positive move to detract Ankara from Western influence for good.

Concluding Remarks

This article briefly analyzed Turkey's ever-increasing aspiration to become a member of the BRICS grouping and analyzed the advantage and limitations of a possible Turkish membership in the BRICS grouping.

It was argued that the first potential benefit of the BRICS membership for Turkey would be an increase in its stature in the world system. Turkey would gladly bandwagon the BRICS club to punch beyond its weights on international and regional issues. A BRICS membership would also greatly help Turkey to revisit its economic dependence on the West generally and the EU specifically. It would contribute to Turkey's import and export trade greatly. Finally the third potential benefit is ontological. Ankara's desire for BRICS membership can partly be seen as an engagement in tactics of shame avoidance, "both retrospective – making up for past misdeeds — and prospective – avoiding future misdeeds" (Mitzen, Larson, 8).

Turkey admittedly remains far below the BRICS members in terms of material and economic capabilities. However, there is an ever-increasing favoring of the BRICS grouping and a rise in anti-Western sentiment in Turkey's contemporary foreign policy. This has been more and more evident ever since Turkish President Erdogan personally attended the 10th BRICS summit in Johannesburg last year. However, Ankara's increasing attention has not yet taken an official form and thus the potential of a BRICS membership is not serious at this point. Yet, there's now an undeniably positive trend in the relations between Ankara and BRICS capitals.


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For the Reasons that Follow, that Country is Currently Not Likely to Be the United States: The Twenty-Eight Newsletter (2019). (Эта страна в настоящее время вряд ли будет как Соединенные Штаты - по следующим причинам: бюллетень 28 (2019).) / Cuba, July, 2019
Keywords: global_governance, expert_opinion

Dear Friends,

Greetings from the desk of the Tricontinental: Institute for Social Research.

The largest delegation from outside Russia at the St. Petersburg International Economic Forum in early June came from China. The Chinese team was led by the country's President, Xi Jinping. In this 23rd Forum, Mandarin joined Russian and English as one of the languages on signs and in conversations. Xi and Russia's President Vladimir Putin seemed comfortable with each other, the bonhomie between the two states clear. During the Forum, the two countries hosted a gala concert to celebrate the seventieth anniversary for the re-establishment of diplomatic ties between China and Russia. Putin said that the links between the two countries have reached an 'unprecedented level', with deals struck for trade and military alignment.

Why have Russia and China cemented this new arrangement?

First, they have been brought together by the long-term push by the United States and its allies to prod at the sovereignty of both China and Russia – whether through the expansion of the North Atlantic Treaty Organisation (NATO) towards Russia's borders or by the US' aggressive naval strategy from Japan to Taiwan. This prodding has led to a harsh sanctions regime against Russia, which has found itself isolated from European markets. This has led Russia to seek closer economic ties with China.

Second, the United States has attempted to get China to surrender its economic advantages to US firms, which has led to the ongoing trade war (see our Dossier no. 7, August 2018, on The Imperialism of Finance Capital and 'Trade Wars'). China has long sought an escape from its close links to the US market. One of these passages out of the US market has been the Belt and Road Initiative (BRI) and the String of Pearls initiative that runs across Eurasia and the Indian Ocean. The BRI has relied upon the Central Asian states, where Russia continues to have a strong influence, and on West Asia, where the Russian intervention in Syria showed Russia's willingness to act—serendipitously—on behalf of Chinese interests.

Fear of US action and the need for a Eurasian regional economic strategy is what brings these two major states together. Michael Yamashita, Mingsha Shan, The Singing Sand Dunes, Gansu, China, 2019.

After the fall of the USSR, the West tried to bring Russia into its orbit. The G7 welcomed Russia into its ranks in 1997 as European and US capital made its entry into Russia and Eastern Europe. That same year, thirteen oligarchs led by Anatoly Chubais – and bolstered by the United States – stole the election on behalf of Boris Yeltsin from Gennady Zyuganov of the Communist Party. Seven of these thirteen oligarchs then carved out the Russian economy for their benefit and for the benefit of their Western partners. The country was looted, its self-esteem weakened. Putin emerged from this crucible, with a pledge to revive Russia's fortunes. Russia's economy relies upon the export of raw materials, which has left it vulnerable to its external markets – mainly Europe. Attempts by the West to install its government in Ukraine led to the expulsion of Russia from the G8 and to sanctions on the country. Russia, which had sought to be part of Europe since the fall of the USSR, now turned eastwards towards Eurasia and – in particular – towards China.

The timing could not have been better. China had bet its new economic policy from 1978 on the markets of the West, with China becoming the workshop of the world. The 'reform era' delivered millions of educated Chinese workers to the globalised economy. Investment of capital and technology flooded into China, from where goods swept the world – but mainly the West. When the general financial crisis took place in 2007-08, China shivered. Its reliance upon the Western markets left it greatly vulnerable. Seeking to break from this reliance on Western markets, China experimented with transfer payment schemes within the country in order to increase domestic demand and began to develop new markets along the monumental Belt and Road Initiative that spans Eurasia, but also has reach into Africa and South America. Russian participation in this initiative is essential, since Russia continues to have close links with Central Asian states and since Russia is the key partner for China in Iran, Syria and Turkey. For a look at the current sanctions regime against Iran and how it has impact Chinese and Russian relations in the region, stay tuned for our upcoming eighteenth dossier in August, Iran Will Not Forget. Michael Yamashita, Inner Mongolia, 2018.

For the past two decades, China has openly called for the creation of a multilateral world order to balance out the unilateral order produced by the West after the fall of the USSR. In 2001, the Chinese President at the time, Hu Jintao, said that 'multipolarity [duojihua] constitutes an important base in Chinese foreign policy'. The US war on Iraq (2003) and the general financial crisis (2007) dented the hegemony of the West. It was in the aftermath of these two events that Brazil, Russia, India, China, and South Africa formed BRICS (2009). The main agenda for the bloc was to push for multilateralism – namely to take advantage of the weakness of the West to assert themselves. But their own programme was limited, a Southern version of neo-liberalism with no alternative institutional basis, ideological worldview, or military power at its feet. The rightward drift in Brazil, India, and South Africa soon made the BRICS formation less cohesive. It was in this context that the alliance between China and Russia took centre stage.

The signal of seriousness can be found in the 2008 solution by China and Russia of their decades-long border dispute. That 4,200-kilometre border is now completely delimited. Regular military exercises began, which culminated in Vostok in 2018, where a third of Russia's army trained alongside Chinese troops. Alongside the military training and strategic alignment has come arms deals, including upgrades from the Russian side to China's People's Liberation Army and now Chinese ships and artificial intelligence to Russia. Michael Yamashita, Panjiakou Reservoir, Qianxi County, Hebei Province, China, 2018.

But there are some weaknesses in the Sino-Russian alliance. China imports mainly raw materials from Russia – 76% of the exports are Russian oil and related products, while 8% of the exports are wood and paper products. China now buys a quarter of Russian oil, thanks to the new oil pipeline from East Siberia into China and to the US-European sanctions on Russia. A new natural gas pipeline is in the works, which will only increase this trade. China, meanwhile, exports mainly finished goods – automobiles, consumer goods, and machinery – to Russia. This imbalance is sharpened by the low rates of Chinese investment in Russia. Part of the debate in St. Petersburg was around these issues, sharpened by Chinese fears of the business environment in Russia. These vulnerabilities will provide an opening for the West.

In 2012, the US National Intelligence Council's report noted that 'by 2030, no country – whether the US, China, or any other large country – will be a hegemonic power'. What the US intelligence officials forecast is the 'diffusion of power' amongst states, with democracy as the vector for this transfusion. But the US has not wanted to accept this new reality. Its policy makers remain trapped by the 1992 Defence Planning Guidance (authored by Dick Cheney), which noted that the US 'must now refocus on precluding the emergence of any potential future global competitor'. Edward Burtynsky, Manufacturing #17, Deda Chicken Processing Plant, Dehui City, Jilin Province, 2005.

Trump's clumsy trade war is part of this policy – with the US spear pointed at the Chinese technology giant, Huawei. The US knows that the main comparative advantage for its economy is Silicon Valley as well as its dominance over intellectual property rights. However, in the arena of this new technology, centred around 5G, Huawei is in the lead (followed by Sweden's Ericsson and Norway's Nokia). Trump's war against Huawei is not as irrational as it seems (as I note in this week's column). His administration—like others before it—has used as much political pressure as possible to constrain the growth of technology in China. Accusations of the theft of intellectual property and of close ties between the firms and the Chinese military are meant to deter customers for Chinese products. These accusations have certainly dented Huawei's brand, but they are unlikely to destroy Huawei's ability to expand around the world. Huawei claims that two-thirds of 5G networks outside of China use its products. The Defence Innovation Board of the US wrote recently that 'The country that owns 5G will own many of these innovations and set the standards for the rest of the world. For the reasons that follow, that country is currently not likely to be the United States'.

Threats and war are instruments to preclude – as Cheney wrote in 1992 – 'any potential future global competitor'. This is the essence of imperialism. That is why this category is so significant if we want to have an accurate understanding of the situation in the world. The new tactics of imperialism, as we show in Dossier no. 17, Venezuela and Hybrid Wars in Latin America, includes the concept of the hybrid war. Imperialism today is not limited to brute force, but rather employs a range of strategies that seek to impose 'full spectrum dominance' over all of society, undermining not only the nation's sovereignty to make economic and military decisions for its own benefit, but also infiltrating the 'minds, hearts, and bodies' of its people; the very way that people understand themselves and the world around them. The rot of war, as I write in this column, is not irrational but is precisely the last refuge of imperialism. P. Sainath, Rayagada, Odisha, India.

Brazil, India, and South Africa remain engaged in the BRICS project, but less centrally than a decade ago. This has to do with the class character of the ruling bloc in each of these countries, where the needle has decidedly gone rightward. These states have become the subordinate allies of the United States. To shift their geo-political orientation requires a shift in the class character of the ruling bloc. Dossier no. 18 is an interview with K. Hemalata, the President of the Centre for Indian Trade Unions, who offers pathways for the Indian working-class and peasantry to assert their own project over the Indian republic. Key here is the question of how to organise the informal workers. Celina della Croce, Coordinator at Tricontinental: Institute for Social Research, draws out the implications of the interview in her report.

The informal BRICS meeting at the side lines of the Osaka G20 summit produced a declaration that retains the main thrust of earlier BRICS deliberations (multilateralism, the need for new institutions, more inter-state democracy), but it introduced few of the key themes of our current moment – such as the harsh unilateral sanctions that the United States has imposed on a number of countries – from Iran to Venezuela – and the US' threats of war. The BRICS summit will take place in Brasilia (Brazil) in November. It is unlikely to advance its agenda.

'Hope', the great Chinese writer Lu Xun wrote, 'is like a road in the country; there was never a road, but when many people walk on it, the road comes into existence'.Warmly, Vijay.
Investment and Finance
Investment and finance in BRICS
What does the future hold for the Brics? (Что БРИКС ждет в будущем?) / United Kingdom, July, 2019
Keywords: expert_opinion, economic_challenges
United Kingdom
Author: Lionel Kruger

The Brics started strongly, but how are they faring? Lionel Kruger examines the five emerging market economies.

The Brics emerging market economies - Brazil, Russia, India, China, and South Africa - were expected to lead world economic growth, and for a number of years, with the exception of South Africa, they did.

China and India put in particularly stellar performances. As a group, the countries have increased their share of world GDP from 8% to 23% and, according to IMF projections, by 2021 the Brics will have accounted for almost half of world growth.

The future, however, is looking less rosy as all these economies face declining output.

China and India

A group of four economists recently published a paper arguing that China may have overstated its annual growth rate by an average of 2% per annum from 2008 to 2016, while India's former chief economic adviser has concluded that the country's growth rate was significantly overstated between 2011 and 2017.

Arvind Subramanian has reportedly stated that India's annual growth between 2011 and 2017 was 4.5%, compared with official figures of 7%. Furthermore, Chinese economy expert Michael Pettis argues that China's GDP is substantially overstated as bad debt has not been written off. He warns that if China's bad debt were written down, GDP figures would be halved.

India has now also politicised GDP growth under prime minister Narendra Modi, with the RBI, India's central bank, under increased pressure to switch objectives from inflation targeting to a policy more focused on growth.

The RBI has cut its benchmark rate for the third time this year and adopted a more accommodative policy stance in an effort to re-energise the economy. Indian GDP growth has dropped to its slowest pace in five years, in keeping with most of its Brics associates.

With the possible exception of China, the other club members, Brazil, Russia and South Africa, all recorded contracting economic activity in the first quarter of 2019.


The Brazilian economy, the world's ninth largest by nominal GDP, has been disappointing throughout 2019, with GDP declining 0.2% and activity continuing to deteriorate. GDP growth for 2020 is estimated at 1.7%, a very low number for a populous emerging market. A crippling two-year recession in both 2015 and 2016 lead to the country's economy contracting by almost 7%, and its recovery prospects will be hampered by ongoing emerging market and developed market weakness.


The Russian economy is stagnating with GDP growth of only 0.5% in the first quarter of 2019. Putin's ongoing stand-off with the West has strengthened statist, nationalist and protectionist trends, delaying Russia's transition to a more market-oriented economy. The private sector continues to be marginalised. Key risks to medium-term growth include ongoing economic sanctions, weaker oil prices and a souring global trade environment.

South Africa

South Africa, Africa's most advanced economy and the smallest of the Brics nations, has suffered a decade of political and economic mismanagement and massive state theft.

It is a country blessed with mineral wealth, and yet one that managed to miss the benefits of the spectacular commodities super-cycle up to 2008 owing to a hostile mining regulatory environment.

GDP growth has remained tepid since its recovery from the 2008 crisis, averaging well below 4% per annum. GDP has once again slumped sharply in the first quarter of 2019, contracting by 3.2% from the previous quarter, the largest quarterly decline since 2009.

The much hoped for economic recovery after President Cyril Ramaphosa's ousting of Jacob Zuma has not materialised as the scale of destruction of the state-owned companies Eskom, SAA, SABC, Transnet, Denel, etc, has become almost an impossible challenge.

The new president also faces significant resistance to change from factions within the ANC still loyal to the former president and determined to continue their pursuit of self-interest.

There is significant pressure within the ANC to impinge on the independence of the Central Bank and follow in the footsteps of India, politicising GDP and targeting growth to the detriment of price certainty and inflation.

This could prove to be particularly disastrous for a country that is the beneficiary of large carry trade flows, which are needed to balance the negative trade and current account balances.

GDP is expected to recover to 0.9% for 2019 and 1.7% for 2020. However, these levels are too low to address poverty and an extremely high unemployment rate.

The Brics, after having started so strongly, now face a number of challenges. They will have to navigate growing trade uncertainties, and increased protectionism.
Customizing heavy-duty trucks to power the world (Кастомизация тяжелых грузовиков, чтобы привести мир в действие) / China, July, 2019
Keywords: economic_challenges

Exports, a broader portfolio, after-sales service in Sinotruk's focus for edge abroad

China National Heavy Duty Truck Group Corp - Sinotruk - is seeking bigger market share overseas, and expects this year's exports of heavy-duty trucks to reach 45,000 units, up almost 24 percent year-on-year, a key company executive said.

"To achieve this goal, we are looking at specific local demand and strengthening our after-sales service network in overseas markets where we are strong already. We are also seeking breakthroughs in new markets such as BRICS member countries like Brazil, Russia and India," said Liu Wei, deputy general manager, who oversees Sinotruk's exports.

Based in Jinan, capital city of East China's Shandong province, Sinotruk sold 12,589 heavy trucks overseas during the first four months of this year, accounting for 48 percent of the total heavy truck exports of China during the period.

Liu said this year, the company is making efforts to set up after-sales service networks and spare parts supply centers to upgrade its service level in overseas markets.

The company has refreshed its human resources practices last September, to ensure employees working overseas reap the benefits of the company's go-global strategy.

"Our employees are now promoted according to their performance and business achievements, not just on the basis of seniority or years of experience. This has greatly encouraged our employees to make top-grade contributions," said Liu.

He said the company currently has over 300 employees working overseas. Most of them were born in the 1980s and 1990s.

Founded in 1956, the company produced China's first-ever heavy-duty truck. It is also one of China's first heavy-duty vehicle manufacturers to explore overseas markets.

In 2003, the company exported only around 40 vehicles. The go-global strategy was adopted in 2004. Since then, it has exported more than 350,000 vehicles to over 110 countries and regions. It has been China's largest heavy truck exporter for 14 years in a row.

To date, the company has set up 69 representative offices and distribution service offices around the world. It has also developed 110 tier-1 distributors, 105 service outlets and 101 accessories outlets in more than 60 countries.

To better meet local demand, it has established nine cooperative knockdown production plants globally and 16 hubs of automobile parts in 12 countries and regions in Africa, the Middle East, Central and South Americas, and Asia.

"Every market has its own features, so we need to optimize our products according to local situations," said Lan Junjie, general manager of the company's international department.

He cited the company's experience in the Philippines, where it has been producing lighter vehicles to meet the local market demand.

While maintaining its momentum in Africa and Asia, the company is foraying into high-end markets in countries and regions like Australia, New Zealand and Hong Kong.

In March, the company delivered the first batch of new street washer vehicles to Hong Kong's local government. This gave the company a toehold in the competitive Hong Kong market, which has stricter automotive fuel and emission standards.

Lan said the move laid a foundation for the company to expand its business in developed markets.

"Our country's higher emission standards have promoted Chinese companies to enhance their core scientific research and development abilities and upgrade the manufacturing level. In five to 10 years, we hope that we can compete with rivals like Volvo technologically," Lan said.

The company has invested heavily in R&D. It now has more than 3,400 patents, of which 240 are invention patents.

This year, the company's substantially increased R&D budget would reach 2 billion yuan ($290 million), said Wan Chunling, chief accountant at Sinotruk. It will hire 1,000 graduates, include foreigners, this year.

"The Belt and Road Initiative is speeding up, creating more opportunities for technological and economic cooperation abroad. Such cooperation will definitely bring more opportunities for companies to expand their business in markets involved in the Belt and Road Initiative," said Zheng Guibin, former deputy director of the Shandong Academy of Social Sciences.

Besides the heavy-duty truck, the light-duty truck is also fading into focus, with exports reaching 460 units during the first four months of this year, up 52 percent year-on-year. The target markets during the first four months were mainly in Africa, the Southeast Asia, South Asia and South America.

The company has also been following the latest trends in the sector, including new energy vehicles, connectivity and autonomous driving, company executives said.
NDB Board of Directors Approves USD 300 mln to the Republic of India for Assam Bridge Project and NDB Reaches USD 10 bln of Approved Loans for Infrastructure and Sustainable Development Projects (Совет директоров НБР одобрил выделение 300 млн долларов США для проекта моста Ассам, а НБР получил одобренные кредиты на 10 млрд долларов для проектов в области инфраструктуры и устойчивого развития) / China, July, 2019
Keywords: ndb, investments, concluded_agreements

With Board of Directors approval of a loan of USD 300 million to the Republic of India for the Assam Bridge Project, the NDB's portfolio has reached 38 loans for infrastructure and sustainable development projects from all member countries of the Bank. In its fourth year of operations, the Bank's cumulative loan approvals reached a milestone figure of USD 10 billion.

Assam Bridge Project

The NDB will provide a loan of USD 300 million to the Republic of India for the Assam Bridge Project aimed at improving transport network connectivity across the Brahmaputra River in Guwahati and enhancing mobility and accessibility in the region. The contents of the proposed Project include the construction of a six-lane-bridge over the Brahmaputra River and approach roads in the north and south banks with the total length of approximately 8 km.

Background Information

The NDB was established by Brazil, Russia, India, China and South Africa to mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries, complementing the existing efforts of multilateral and regional financial institutions for global growth and development. To fulfill its purpose, the NDB will support public or private projects through loans, guarantees, equity participation and other financial instruments. According to the NDB's General Strategy, sustainable infrastructure development is at the core of the Bank's operational strategy for 2017-2021. In August 2018, the Bank received AA+ long-term issuer credit ratings from S&P and Fitch.
Support of the Russian Economy Growth by BRICS New Development Bank (Поддержка роста российской экономики Новым банком развития БРИКС) / Russia, July, 2019
Keywords: ndb, expert_opinion, economic_challenges
Author: Yana Grigoryeva

Yana Grigoryeva, Intern at the Russian National Committee on BRICS Research - special for InfoBRICS

The BRICS countries cover more than a quarter of the world's territory with more than one third of the world`s population. BRICS became a new center in the global economy. In 2016, the total economic output was approximately 22 per cent of global GDP, up from around 11 per cent in 2005. Despite the potential risks to the global economy posed by rising protectionism and increasing insularity in some developed economies, the BRICS countries continue to be a major driving force of the world economy, contributing around 45 per cent of global growth. That's why the New Development Bank was launched in aim to help BRICS countries rising the economic growth.

Rising exports and strong consumer demand supported Russia's economy in its return to a growth path in 2017. According to the country's statistics service, public investment in infrastructure in 2017 was USD 33 billion (both federal and regional budgets), while private investment in fixed assets (excluding own sources of finance) amounted to $65 billion.

Total infrastructure investment accounts for 6 per cent of Russia's GDP. The vast territory and sizable consumer base provide great opportunities for development, also in non-commodity sectors. Expanding into new industries and services will demand additional improvements in transportation, communications, power generation and logistics, especially in more remote areas. There are also opportunities in the development of infrastructure for connectivity through trade and transport corridors and logistic centers that would facilitate regional integration and trade development.

NDB is expected to play a significant role both in catalyzing private capital to infrastructure development and contributing international standard practices in planning and implementing infrastructure projects. Up to 2017, NDB had approved more than $629 million for projects in Russia, including in renewable energy generation and transportation.

The main drivers of Russian economy growth for the next five years will be cities and roads improvements. This sphere is becoming more and more significant direction of the BRICS New development Bank`s investments flows. The NDB is going to increase the loans portfolios to Russia by 15-20% till 2021. At the end of 2018 this rate was about $2.5 billion, and this year it will probably grow up to $16 billion.

There are few particular projects to achieve this amount of investments. One of them is about renewable energy. Russia submitted its first investment project to the Bank-the development of small energy in Karelia. This is hydrogeneration, which will provide energy to the cities, towns, industry. Also, another big project concerns the professional education system. In 2017, the Baikal Institute of BRICS was opened. The Institute has educational programs in the areas of environmental engineering and clean energy, digital technologies, innovative economy and international business. Classes are taught in English by successful Russian and foreign professors. More than 40 citizens of Russia, China, Nigeria, Egypt, Indonesia and Mongolia became students of the institute. As for the current projects, there are 6 of them in total, worth about $1.5 billion. Moreover, now BRICS NDB is discussing with the Russian Railways a large project of 500 million- construction of the high-speed highway "Moscow-Kazan". It will be an investment in one particular line. But Russian Railways has many attractive projects, and the BRICS Bank is ready to provide the necessary support in all areas. In the next two years, up to eight concessions in the railway industry can be concluded in the railway industry.

NDB has extended support to a road development project in Ufa, Russia, a city that is grappling with rising traffic volumes and inadequate road infrastructure. Improving infrastructure and connectivity with coordinated policy has proven to be an effective way of increasing productivity and the resilience of a country's economy. Through a sovereign loan of $69 million to the Russian Federation to fund a portion of the $701 million project, NDB is providing financing to support the construction of 10 kilometers of road, a 1-kilometre road tunnel, and a 2.5-kilometre bridge across the Ufa River, as well as toll collection stations and other supporting infrastructure. A transport corridor will be constructed to the east of the city center, connecting it to the surrounding suburbs.

BRICS Bank also participates in the implementation of national projects in Russia. Bank develops its participation in all sectors, but infrastructure is a key focus. The Bank is ready to discuss with the Government of the Russian Federation any project in this area. In all countries of presence, the Bank builds roads and railways, participates in water purification projects (for example, the Volga Health Improvement program, which involves the reconstruction of wastewater treatment plants for the further development of the water supply and drainage system of the city of Dzerzhinsk), in the electric power industry, and in social sectors. The Bank already has several similar investments in other countries, for example, $300 million has been allocated for the project of ecological restoration of water resources in Chongzuo in China, $80 million - for the project of development of the renewable energy sector of the African company «Industrial Development Corporation».

NDB is contributing towards Russia's development of a transparent and effective judicial system. NDB is providing a loan of $460 million to support Russia's judicial development strategy. With a total cost of $601 million, the project's main focus is institutional development and aims to improve the efficiency, effectiveness and transparency of the Russian judicial system. Funds will be directed towards upgrading physical infrastructure such as building new administrative buildings and integrating information and communication technology systems to implement a new electronic case management system.

In general, the impact of national projects on the economy of the Russian Federation can be assessed as positive. For example, "green" energy helps not to pollute the environment. Building roads and supplying villages with water make people`s life easier. In addition to economic benefits, investment can bring many other results.

BRICS Bank also interacts with other development institutions in the BRICS countries. Cooperation is carried out mainly on the presence of the Bank in various countries. Development institutions in Russia are not funded yet. But in the process of work, there is a very close interaction with Russian institutions and further cooperation is based more on the field of expertise.

Previously, the BRICS Bank was mainly focused on lending projects in foreign currency - mainly in dollars. However, due to dedollarization and increased risks of blocking accounts in US currency, borrowers from countries under sanctions decided to pay more attention to financing projects in national currencies. The purpose of the Bank is to popularize national currencies, because it is the least risky money in which a country can borrow. In Russia, the Bank sees great interest in issuing bonds in rubles. The BRICS NDB plans to issue bonds in rubles at the end of 2019. At the initial stage, the development institute wants to attract 15-20 billion rubles. This will be the first entry of the bank into the Russian market.

The bank will give the credits in rubles to two Russian clients who have such a need. Some customers in Russia are willing to borrow in euros and Swiss francs. Thus, at least three currencies in Russia can compete with the dollar.

In the first year of operation, the demand for loans from the BRICS Bank in the Russian Federation was quite low. There are some significant difficulties with Russian market entry. In particular, the BRICS NDB in Russia doesn`t yet have a credit history, so it is unlikely that the bank will be able to borrow there at favorable rates.

Another difficulty lies in the fact that now the Bank, as a rule, invests under the condition of state guarantee for the borrower. This cuts off many private projects from the bank's money, often more efficient than government projects. In any case, financing the BRICS Bank for Russian projects is a positive factor. Especially against the backdrop of the other international institutions` withdrawal from Russian - for example, the European Bank for Reconstruction and Development.

In addition, the bank is not enough mature in the local market, it can`t assess the risks associated with specific characteristics of Russian business. Partially this problem can be solved by opening a branch in Russia. This step was announced in April 2019 at the general meeting of the BRICS Bank participants in Cape Town. This year the Bank plans to increase the share of the portfolio of Russian loans by 15-20%.

In 2018 Russia's economic growth was 1.3%. It is possible that this year the growth will be from 1 to 1.5%. One of the consequences of economic growth will be urbanization. It can give impetus to the growth of the Russian economy in the next five years. This will be a key drive - the development of cities, roads, construction of the subway. Another driver is railways. Therefore, the key growth zone of the Russian economy is infrastructure. Russia needs a well-developed infrastructure due to its size and population size. China, which is at the first stage of developing a powerful infrastructure, can serve as a good example. Infrastructure development will be followed by growth in production and services. Because now the leading businesses are spheres that didn`t exist five or ten years ago: food delivery, online shopping, and so on. The main growth is expected in the service sector.
Political Events
Political events in the public life of BRICS
Accelerating Economic Diplomacy towards a better South Africa, Africa and world: DIRCO Budget Vote Speech 2019 (Ускорение экономической дипломатии в направлении улучшения положения в Южной Африке, Африке и мире: выступление МИД ЮАР по голосованию за утверждение бюджета 2019 года) / South Africa, July, 2019
Keywords: speech
South Africa

Honourable Chairperson,
Deputy Ministers,
Honourable Members,
Your Excellencies, Ambassadors, High Commissioners, members of the Diplomatic Corps and Representatives of International Organisations,
Distinguished Guests,
Ladies and Gentlemen

I am pleased to have the opportunity to report to this House on our progress and activities in the 2018/19 financial year and to indicate our plans for 2019/20.

Last year DIRCO was allocated R6 552.7 billion to be utilised to advance our agenda for global co-operation. The development of our region and our continent. This year we are allocated R6 508.5 billion and as with all departments we are confronted by the limitations of budget reductions, currency fluctuations and the inadequacy of our compensation budget. Given these challenges we have to use our resources wisely and strategically. The reduced budget severely impacts on our ability to support government in reaching our national priorities. Fortunately, we have an excellent team in DIRCO and we shall do our best.

Debates on the international relations budget and programme are incomplete if they are not associated with the tremendous role the international community played in supporting us to achieve freedom. We have in many ways sought to honour these solidarity based contributions through reciprocating in creating a just world order that has a humane face – a face of empowered women and girls, of men and boys, free from war, living with human security. I have been pleased that our statements and voting pattern in Geneva and New York reflect our support for a more just world.

Our work must always reflect this commitment to return the privilege of international solidarity with attention to the plight of those who seek refuge, democracy, freedom and peace.

The world has improved vastly from the world in which racial domination could thrive, yet Palestine is still occupied and not free, South Sudan has internal conflict, Western Sahara is still occupied and not free, Cuba remains blockaded and extremism and terrorism destabilise the world. Powerful forces of economic bullying seek to alter the established multi-lateral world order. Africa too continues to have many development challenges. We have to promote our relations in this challenging context. We have to use our extensive network and limited resources to support the emergence of a world where all enjoy freedom and democracy, increased human security and peace. Our relationships with the world must be centred on achieving these outcomes.

This year we celebrate 25 years of freedom. Even though we are young adults in democracy, we can as President Ramaphosa said in SONA "move forward together towards achieving a stronger, greater, more compassionate, more united and harmonious South Africa" and we add Africa.

We recall too that Rwanda is commemorating 25 years since the genocide of 1994. We reaffirm our friendship and solidarity with the people and government of Rwanda and salute them for their determined efforts to achieve reconciliation and a nation at peace with itself. The search for social cohesion and reconciliation have been put to good effect in both our countries and we should use this common experience to forge greater links.

The work we do will advance such links and also actively contribute to the seven priorities announced by the President:

  • Economic transformation and job creation;
  • Education, skills and health;
  • Consolidating the social wage through reliable and quality basic services;
  • Spatial Integration, human settlements and local government;
  • Social cohesion and safe communities;
  • A capable, ethical and developmental state; and
  • A better Africa and World.
These priorities are global, they are in the NDP, the SDGs (Agenda 2030), and in our Africa Agenda 2063. We will promote action to realise them for our country and our continent.

We pursue the priorities in a period in which Africa has entered a phase that holds much promise for genuine sustainable development. We plan to use our diplomacy to build stronger links with Nigeria, Egypt and Kenya as anchor countries that should advance these goals.

Many African countries are achieving positive economic growth and developing social and economic infrastructure that expands the likelihood of national development, higher growth levels and social development for all. It is noteworthy that democracy has also taken root in much of the continent with free, fair and regular elections on the rise.

We are very encouraged by the launch of the African Continental Free Trade Area Agreement. Now that the ACFTA has come into force, immense opportunity for trade within Africa has come into being. South Africa must ensure it is ready to take advantage of the potential offered by this expanded market access. Once the agreement is fully operationalised Africa will be one of the world's largest single markets encompassing 55 countries, a population of 1,2 billion people and a combined GDP of 3,2 trillion U.S. dollars. The development of the necessary infrastructure is going to gather speed and we must be ready to play a key role.

In addition honourable members, our capacity for research and innovation could play a critical role in enhancing our industrial development ambitions.

Minerals beneficiation, advanced manufacturing and wider use of digital technologies could place us at the leading edge of economic innovation support in Africa.

South Africa has excellent research universities, trains a large number of African post-graduate students and absorbs only a small number of them. We also have very competent research councils, imagine the contributions we could make to Africa if we multiply this capacity. The development in potential of a vibrant Africa based knowledge economy would become a genuine reality. Our capacity for innovation must become part of our diplomatic interactions and be utilised to advance our continent's interests.

We should promote the creation of hundreds of research institutes all over Africa and support them to be innovative, productive and responsive. We have the capacity, let us use it strategically.

One of our major co-operation successes is our regional economic community that has established a strong platform for greater integration and growth. We must consolidate and expand trade and investment in SADC and give effect to the President's assertion that:

"Within the SADC region, we should prioritise development of cross-border value chains in key sectors such as energy, mining and mineral beneficiation, industrialisation and enhancing manufacturing capacity, infrastructure development as well as agro-processing".

We will, therefore, intensify several related SADC initiatives.

I am pleased with the progress that was achieved during South Africa's tenure as SADC chair.

Progress on regional trade has been increased by the operationalisation of the Integrated Real Time Gross Settlement System (SADC-RTGS), which is hosted by the South African Reserve Bank. A total of 81 banks (central banks and commercial banks) are participating in the system. The system aims at establishing a firm platform for increased intra-SADC trade and investment to further strengthen regional financial integration. The SADC-RTGS has performed impressively since July 2013 when the system went live, with a total of 1,275,591 transactions settled as at end 2018, representing ZAR5.21 Trillion. The benefits of the cross-border payment system are its efficiency and the reduction in transaction costs. This experience is going to be a valuable contribution to the development of the payment system announced at the AU Summit in Niger three days ago.

A second example is the completion and adoption of the SADC Energy Foresight and Assessment Study for Renewable Energy Value Chains.

Member States are going to use the recommendations to develop SADC renewable energy capacities. The Council for Scientific and Industrial Research (CSIR) was tasked to conduct a mapping exercise of potential renewable energy value chains for use by Member States. A progress report will be presented to Ministers in June 2020.

Third, the SADC Engineering Needs and Numbers Study has been concluded. It will assist Member States to implement programmes for developing enhanced engineering training at national or regional platforms to enable career development through sharing of experience and expertise. Furthermore, Member States were also urged to introduce Science, Technology, Engineering and Mathematics subjects at early stages in the education systems to increase the number of students able to take up studies in engineering fields.

Tripartite Free Trade Area

The Common Market for East Africa (COMESA) – East African Community (EAC) –Southern African Development Community (SADC) Tripartite Summit agreed in October 2008 to accelerate the programme to harmonise trade arrangements among the three Regional Economic Communities (RECs), with a view to establishing a single free trade area (TFTA) encompassing all Member States of the three RECs.

Our country appended her signature on the Agreement establishing the TFTA on 7 July 2017 in Kampala, Uganda. To date, the Agreement has been signed by 23 member countries and requires 14 ratifications to enter into force. To date, only Kenya, Egypt, Uganda, and South Africa have signed and ratified the agreement.

South Africa will intensify its diplomatic efforts aimed at urging other TFTA members to sign and ratify this important trade facilitation instrument in order for it to become operational. To this end, a TFTA Summit is scheduled to take place in January 2020 in Rwanda, we hope that the ratification threshold would have been achieved by that date.

The recent report of Africa's regional bodies at the AU's extra-ordinary summit confirmed the critical role regional bodies are playing in our development programmes.

Honourable Members,

Our commitment to Agenda 2063 remains steadfast. We are honoured to have been selected as the 2020 AU Africa Chair. We are cognisant of the huge responsibility, this places on South Africa, particularly, the pursuit of the ambitious goal of silencing the guns by the end of 2020 in the continent.

We have a rare opportunity to place this goal on top of the Agenda of the United Nations Security Council (UNSC) when we assume the Presidency of the Council in October 2019. The theme for our Council Presidency is "Continuing the Legacy: Working for a Just and Peaceful World". It is important to use our tenures at the UNSC and as chair of AU to implement the Enhanced Co-operation Agreement on Peace and Security as it foregrounds commitment to conflict prevention and to addressing the root causes of conflict.

This is the embodiment of the legacy of Nelson Mandela who, during his tenure as President of our country, worked tirelessly to advance peace and stability on the continent and globally, through mediation, and preventative diplomacy.

The continued existence of conflicts in Africa diverts us away from our goal of peace and development. In this regard, we repeat our call for a total ceasefire in Libya and the pursuit of an inclusive national dialogue led by the AU. On Sudan, we deplore the recent violence and deaths in that country and welcome the agreement reached by the Transitional Military Council and the Forces For Freedom and Change. This is an opportunity for the people of Sudan to begin entrenching peace and stability. We applaud the mediation efforts of the AU and IGAD. As South Africa we stand ready to assist where we can. Our experience in conflict resolution and in drafting a progressive constitution, make us a partner genuinely able to resolve complex national problems.

Our President has done much to assist the Kingdom of Lesotho to achieve political stability. While appreciating progress reported recently, we implore all the people of the Kingdom of Lesotho to work diligently on the finalisation of the necessary constitutional and security sector reforms. We thank former Deputy Chief Justice Moseneke for his work as the presidential envoy.

Honourable members.

A peaceful and stable as well as economically integrated Africa will contribute towards transforming the world to ensure that people of the global South are not marginalised. We have partnered with like-minded countries to improve our condition and that of our partners. Work in Africa's partnership with China in the Forum for China Africa Co-operation and with Japan in The International Conference for Africa's Development can make a significant contribution to our development.

The BRICS is also a formation which has the potential to change the global political and economic outlook. The work of the New Development Bank (NDB), its Africa Regional Centre (ARC) and the Contingency Reserve Arrangement (CRA), are concrete examples of the effectiveness of BRICS.

The ARC is focussed on providing financial and project preparation support and funding for infrastructure and sustainable development in South Africa, Africa and in future to developing countries at the global level.

In April this year, the NDB approved around $790 million of loans for three projects in South Africa. Over half the funding is for Eskom to stabilise our national electricity grid. The NDB and Eskom signed a separate agreement for a $180 million loan to implement an integrated renewable energy project. This is evidence of the use of diplomacy to address national imperatives.

The NDB will also provide infrastructure and sustainable development project funding to countries that are not members of the BRICS. It has confirmed that part of the $790 million will fund the Lesotho Highlands water project. The implementation of the Second Phase of this project is important for both South Africa and Lesotho as it provides water to the Gauteng Province and hydro-energy for Lesotho's electricity needs.

Honourable Members,

We continue to enhance our cooperation with institutions and countries of the North. Our partners continue to play a constructive role in bridging the global development divide.

President Ramaphosa has been consistent in using platforms like the G20 and the G7 to argue for support for Africa and for a fair, inclusive and balanced world trade environment. We believe in multilateralism and reject attempts at unipolarity and neglect of the poor and marginalised. We believe much more must be done for shared growth, for the empowerment of women and the eradication of poverty and reduction of inequality.

Success in pursuing these objectives means leadership, hard work, consistency and commitment. We as Africans must rise and act in our interest, must execute our own agenda.

Honourable members,

The United States of America is our strategic partner in the fight against HIV and Aids. They have been instrumental in supporting our national and HIV interventions and American businesses continue to invest in South Africa to create employment and reverse the frontiers of poverty. We have excellent trade relationships and are determined to expand them for increased growth and job creation.

We will affirm these links while also working to support measures for peace in South Sudan, freedom and justice for the people of Saharawi and freedom, security and democracy for the people of Palestine. We will also continue to strive for the end of the unilateral economic blockade against Cuba and continue to strengthen our collaboration.

We have been closely monitoring developments regarding the UK's planned exit from the EU. South Africa remains strongly committed to our Strategic Partnership with the European Union, which has created a platform for engagement at various levels, not only on bilateral matters, but also on matters pertaining to regional, continental and global challenges. The European Union (as a bloc) is South Africa's largest trading partner with total trade having increased from R497 billion in 2014 to R620 billion in 2018. While there remains a significant trade deficit, South African exports to the EU have increased from R197 billion in 2014 to R268 billion in 2018. The R1.4 trillion in foreign investment from Europe (representing approximately 77% of total FDI in the country) has made a significant contribution towards job creation and industrialisation in South Africa.

We will work with greater energy to increase our cooperation with India, Russia and Brazil. Our partnership with the People's Republic of China continues to grow. The recent conclusion of 90 trade and export contracts will enhance our partnership even further.

In the recent SONA the President referred to the need for us to increase tourist arrivals to support our economy. Europe and Africa are among leading continents in terms of tourist arrivals in South Africa.

I have tasked all our Missions abroad with the responsibility to help manage and brand South Africa to attract more tourists. Similarly they have the huge task of assisting us in securing more Foreign Direct Investment (FDI), whilst identifying and leveraging trade and cultural diplomacy opportunities in their host countries.

Honourable Members,

Our foreign policy principles remains centred on promoting peace, human rights and dignity for all people in all countries of the world. We continue to be guided our apex mandate, our Constitution. I am studying the report of the Ministerial Review Panel on our Foreign policy and hope to report on our response to the portfolio committee soon.

We also hope that Parliament will conclude its processing of the Foreign Service Bill.

I wish to thank the two Deputy Ministers for their guidance and support in preparing for the Budget Vote. Deputy Minister Botes will outline further details of our work in his contribution.

The Director-General and the management of the Department, my special advisors, ministry staff and family contributed immensely to this budget vote and their efforts are most appreciated. Let me thank the DIRCO Team for their role in ensuring that a detailed overview of our work is presented in this debate.

I thank you.


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BCC signs MoU with BRICS chamber to promote trade (BCC подписывает меморандум о взаимопонимании с палатой БРИКС для содействия торговле) / South Africa, July, 2019
Keywords: concluded_agreements, trade_relations
South Africa

The Bharat Chamber of Commerce, (BCC) and the BRICS Chamber of Commerce and Industry, New Delhi, signed an MoU on Tuesday for promoting trade and investments between the BRICS countries and the eastern part of India, in particular.

Members of the BRICS are Brazil, Russia, India, China and South Africa.

The MoU was signed by BCC president Sitaram Sharma and BRICS Chamber of Commerce and Industry Director General B B L Madhukar, a statement said here.

"The BCC is looking forward to working closely with the BRICS Chamber of Commerce to foster trade, technological and industrial cooperation between West Bengal and BRICS countries," Sharma said.

The MoU will enable both the BCC and the BRICS chamber to share trade related information and exchange trade delegations among the five countries of the group.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
Russians come calling: ISRO and Russian Space Corporation to work together (Русские приняли приглашение: ISRO и Роскосмос будут работать вместе) / India, July, 2019
Keywords: space, cooperation

Russians come calling: ISRO and Russian Space Corporation to work together

Ahead of the launch of Chandrayaan-2 on July 14-15, production of space systems in India, cooperation in futuristic technologies including new space systems, training of the Indian astronaut for the Gaganyaan mission among other issues discussed between India and Russia this week.

Russia's ROSCOSMOS and former Deputy Prime Minister Dmitry Rogozin held detailed high-level talks with National Security Adviser Ajit Doval, where both sides also talked about rocket engines, propellants and propulsion systems, spacecraft and launch vehicle technology and working together on India's first Space Station.

Financial Express Online was the first to report that the Russian Roscosmos State Corporation for Space Activities and Indian Space Research Organisation (ISRO) are going to work together on India's first manned space mission.

From the Russian side, there were representatives of ROSCOSMOS, GLAVCOSMOS, Energia and Energomash and the Indian side was led by the ISRO chairman Dr Sivan, along with the Director of the Human Space Flight Programme, and other senior officials who were present during the meeting.

Keeping in mind the special and privileged partnership and India's priorities such as the Make in India initiative, both countries have decided to take a strategic approach to elevate the bilateral cooperation in the Space sector to the next level.

With India's growing capabilities in outer space, Russia sees India as a key partner and for promoting peaceful uses of outer space.

In 2018, in the presence of Prime Minister Narendra Modi and Russian President Vladimir Putin, an MoU was inked between ISRO and the Federal Space Agency of Russia 'ROSCOSMOS' relating to the joint activities in the field of Human Spaceflight Programme.

Russia has already offered Indian astronauts a short visit to International Space Station (ISS) onboard a Soyuz spacecraft as part of the training for India's moon mission planned for 2022.

The former Soviet Union has a major role in India's Space Programme. It was one of the three partners who helped India's programme to get off the ground and is also behind sending an Indian cosmonaut in a Soviet Soyuz mission in 1982.

The two countries have already decided to set up measurement data collection ground stations of the Indian Regional Navigation Satellite System NavIC and the Russian Navigation Satellite System GLONASS in both the countries. Also, India and Russia have decided that cooperation on remote sensing satellite constellation for BRICS (Brazil, India, Russia, China and South Africa) will go on.
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