Ehizuelen Michael Mitchell Omoruyi
The emergence of BRICS has raised hopes that win-win partnerships can foster the development of Africa. The BRICS countries (Brazil, Russia, India, China and South Africa) oppose Cold War mentality and hegemonism, and are committed to promoting multilateralism, mutual respect, cooperation, fairness and justice, by cementing a global alternative that represents the trend of history.
BRICS accounts for more than 40 percent of the world population and 20 percent of global trade, and attracts 25 percent of global foreign investment. It represents the development expectations of emerging markets and developing countries, promotes cooperation among developing countries, acts as a platform for South-South cooperation, and has made substantive progress in cooperation across the board. And the BRICS Summit in South Africa from Tuesday to Thursday will add to the vitality of this unique economic grouping.
Unlike certain countries that are trying to divide the world into blocs and expand their military alliances to maintain their domination in almost all fields, BRICS, which as a grouping has been growing at a faster pace than the G7, is focused on maintaining world peace and promoting common development, including Africa’s development. BRICS has emerged as a formidable economic bloc in recent years, with a combined GDP of more than $20 trillion in 2021 against the G7’s GDP of about $35 trillion (both in nominal GDP terms). However, in terms of purchasing power parity-adjusted GDP, the BRICS members contribute 31.5 percent of global GDP while the G7’s share has fallen to 30 percent. It is clear therefore that BRICS will be in a stronger position to counter the interventionist attitude of the International Monetary Fund and the World Bank when giving loans, and the United States when offering economic, political and military assistance.
Given BRICS’ rising economic and political power and increasing engagement with African countries, the BRICS countries are more attractive to Africa. They are attractive also because they offer new opportunities for trade, investment and technology transfer, which can help boost Africa’s development and integration. In terms of finance, too, BRICS provides a better alternative to the existing global financial system led by the IMF and the World Bank. For example, in 2014, with $50 billion in seed money, the BRICS countries launched the New Development Bank not only as an alternative to, but also to complement the work of, the IMF and the World Bank. Likewise, BRICS created a liquidity mechanism called the Contingent Reserve Arrangement to support its members struggling with payments. These efforts and measures appear very attractive to African countries, especially because they have had painful experiences with the IMF’s structural adjustment programs and austerity measures. This is one of the main reasons many African countries have shown interest in joining BRICS. In recent years, the BRICS countries, China in particular, have expanded their economic engagement with Africa. For instance, China is the largest trading partner of Africa and is becoming a more important market for African countries. In 2022, 12.5 percent of Africa’s exports went to China, compared with a mere 0.8 percent at the beginning of the century.
According to official statistics, the total trade value between China and Africa hit an all-time high of $282 billion in 2022, up 11 percent year-on-year. China has also invested heavily in infrastructure and industrial projects in African countries. India, too, has increased its trade with and investments in Africa, mostly in the fields of agriculture, healthcare, renewable energy, infrastructure, education and information technology, and set up a $10 billion fund to support development projects in Africa. Based on the Indian Ministry of Commerce and Industry data, in the 2022-23 fiscal year, trade between India and Africa grew by 9.26 percent to nearly $100 billion, up from just $7 billion in 2001. And the fact that its exports amounted to $51.2 billion and imports $46.65 billion shows that India-Africa trade was more or less balanced. Brazil and Russia have also increased their engagement with Africa through various initiatives including the Brazil-Africa Agriculture Platform, the Russia-Africa Summit, and the South Africa-India-Brazil Dialogue Forum. Taken as a whole, BRICS is Africa’s largest trading partner. In fact, the 2022 economic survey data from the African Development Bank show BRICS is now Africa’s largest trading partner with their trade expected to cross $500 billion by 2030, with China accounting for 60 percent of it. The BRICS countries are also becoming significant investors in Africa, especially in the manufacturing, infrastructure and service sectors.
The above facts show BRICS is promoting South-South cooperation and making efforts to build a multipolar world order, which resonates with Africa’s vision of achieving regional integration and becoming self-sufficient. As a matter of fact, African countries have decided to adopt a policy of strategic autonomy from the West, because Western economies are known to prioritize and impose their own interests and values when engaging with African countries. The African countries have realized that reliance on the West makes them vulnerable, especially when their interests conflict. The fact that they have to mainly sell their energy and other resources to Western nations, conduct trade in US dollars and use the West’s Society for Worldwide Interbank Financial Telecommunication system for transactions is seen by African countries as a weakness, because the West has used the dollar, as well as the institutions such as the IMF and the World Bank, as an economic and political tool to control the African countries. So when African countries fight for autonomy and say they want to de-dollarize their economies, they are actually seeking total freedom from the West and its institutions. This freedom includes realizing economic emancipation, the freedom to conduct trade based on equality and manage their internal affairs without being dictated how to do so by the West. This in turn necessitates the reconfiguration of the global economic architecture, in which every country will be free to trade independently, without any conditions.
Since the African countries oppose the West-centered world order and are making efforts to make their economies more dynamic, they welcome the emergence of BRICS, because it opposes the domination of the West and offers African countries novel ways to de-dollarize their economies. The African countries think this paradigm shift will protect them against Western pressure, which is another key factor that has prompted African countries to partner with BRICS. As a way of benefiting from this new partnership, African countries should further increase their trade with the BRICS countries and leverage their strengths and resources for mutual gain. This can be done if the African countries adopt a strategic approach to engaging with BRICS based on the assessment of their respective strengths and weaknesses, and by pursuing mutual benefit. For that, however, they need to strengthen their domestic institutions and policies, enhance regional integration and cooperation, and engage in a more assertive and proactive manner with the BRICS countries and other emerging market economies based on a shared vision of mutual benefit, inclusivity, and sustainability. In particular, the African countries need to leverage their natural resources, cultural diversity and strategic location to boost their economic development. They also need to capitalize on the opportunities created by BRICS and the evolving global economic order by prioritizing investments in education, technology and infrastructure, and promoting innovations and inclusive and sustainable development.
Above all, African countries need to attract more investment from and increase trade with the BRICS members and other developing countries. By doing so, they can unleash their full potential and contribute to shaping the future of the global economy in a more equitable and balanced manner.
The China Daily