South Africa’s entry into BRIC to reshape world economy
After a year of hard work, South Africa has formally joined with the four major emerging powers that form the BRIC cooperation mechanism. South African media said it is an important milestone, signifying South Africa is becoming a major emerging economy in the world.
The prime motivation for South Africa’s entry into BRIC — short for Brazil, Russia, India and China — is to create conditions for the country’s economic development. Before the outbreak of the international financial crisis, South Africa had experienced the fastest economic growth since 1994, with the economy growing at a rate of more than 5 percent for three consecutive years. But the financial crisis drastically slowed economic growth and pushed unemployment higher.
The role of South Africa’s traditional trading partners — Western countries — has been lessened significantly and the emerging economies are becoming increasingly prominent. China is South Africa’s largest trading partner, and South Africa is the largest destination in Africa for China’s direct investment.
South Africa’s trade with India increased to 7.5 billion U.S. dollars last year. Its trade and investment with Brazil and Russia also increased rapidly. The emerging economies are bringing more opportunities for South Africa’s development. The accession into the BRIC has become inevitable as the South African government stresses diplomacy should serve the interest of economy.
By joining the BRIC countries, South Africa also hopes to become the gateway for the BRIC countries’ entry into Africa. From 2000 to 2008, BRIC trade with Africa increased more than seven times. In 2008, the BRIC trade with Africa accounted for nearly 20 percent of Africa’s total foreign trade volume.
Some economists believe that the BRIC is taking Africa from the edge to the center of the global economy. As Africa’s largest economy, South Africa has companies operating in more than half of the African continent. South Africa is looking forward to expanding cooperation with the BRIC counties in Africa, which will ultimately promote national economic development.