Emerging markets – a ten-year review of the BRICS trading relationship
From the 22nd – 24th of August 2023, the BRICS, which includes Brazil, Russia, India, China, and South Africa, held its 15th Summit in South Africa. This was the third time South Africa hosted the group. The BRIC (Brazil, Russia, India and China) was initially formed with a focus on foreign investment strategies and held its 1st formal Summit in 2009. South Africa joined the group in 2010, and together, they became synonymous with fast-growing emerging economies. These emerging markets currently represent 43% of the world’s population and a third of the world’s gross domestic product (GDP). The BRICS countries, which in the early 2000s were considered to be the fastest growing economies, have not maintained this performance. Brazil, Russia, and South Africa’s economic growth has been sluggish, averaging less than 1% annually since 2013, while India and especially China experienced annual GDP growth rates of over 6% during the same period. The commodity shocks experienced in 2014/2015 had an impact on the economic growth trajectories of commodity-dependent member states such as Brazil, Russia, and South Africa. Furthermore, the BRICS differ considerably in demographic, economic, military, and political terms as well as in terms of their regional and global ambitions. Despite their unique characteristics, these nations must prioritize diversifying their economies and increasing the involvement of the private sector.
This Trade Brief provides an update on the trading relationship between the BRICS countries over the past decade with specific focus on South Africa’s position and performance. Additionally, it explores the development of the BRICS bloc and emerging issues, including the role of the New Development Bank (NDB), the expansion of the bloc, and the proposed currency as an alternative to the US dollar in international trade. The report concludes with a summary of its findings.
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