PRETORIA— The newest member of BRICS, South Africa, will host this year’s summit of the group of emerging economies that comprises Brazil, Russia, India and China. South Africa says it wants emerging economies to have more say, internationally, and to flourish on their own terms, amid a global economic crisis caused by the world's traditional superpowers. At this year's summit, BRICS plans to take a decisive step in that direction by starting their own bank.
Mineral-rich South Africa has long viewed the world's richest eight nations with a degree of suspicion. Those northern-hemisphere nations determine the world's economic course and, South Africa says, do so based on their own needs - not those of developing nations.
So in 2010, South Africa joined its own economic club in hopes of increasing its influence becoming the latest member of the group of emerging economies - known as BRICS.
Together, these five nations represent about $13.7 trillion, which is about a fifth of the world's GDP (gross domestic product). Fast-growing, resource-rich South Africa seems like a logical partner - it is the only African member of the G20 group of nations.
This year, South Africa will host the group's summit in March, where they are expected to finalize preparations for their own development bank.
Ambassador Anil Sooklal, deputy director-general of South Africa’s Department of International Relations and Cooperation, says finance ministers have not decided where the bank will be or what the bank's initial funding will be - the oft-discussed figure is $10 billion per nation, for a total of $50 billion. He says the members are "comfortable" with that figure.
"And, I should also point out there is the political will to have this bank. That there is no question around that, there is the political will from all the BRICS countries," said Sooklal. "Given that within the multilateral development banks, the funds are drying up, they're shrinking. And, countries of the north have their own challenges. So, liquid capital - in terms of addressing the development challenges of developing countries - is becoming more and more scarce. And therefore, the argument made was that the capital of... almost two-thirds of foreign reserves are held by developing countries today. And, a major part of that is from BRICS countries. That this liquid capital is being invested in sovereign wealth funds in the north. And, it's felt that this should be invested in something that would work for ourselves."
As many as 800 businesspeople from the BRICS nations are expected to attend its fifth summit and will have a chance to meet with high-level leadership.
The summit starts March 26 in Durban.