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“Sluggish global growth and weak demand amongst the world’s advanced economies has turned the BRICS towards each other, as well as a broad range of emerging markets, for commercial nutrition. Linked to this, recent trade figures suggest that BRICS-Africa commercial ties are increasingly vibrant and, crucially, robust,” the report says.
The report was released on the eve of the visit last week of Russian foreign minister Sergey Lavrov to Africa where he emphasised an initiative to bolster business and political ties with the continent.
Lavrov said that Moscow was particularly interested in increasing trade with fellow BRICS member South Africa ahead of a summit bringing Brazil, Russia, India, China and South Africa together in Durban at the end of March.
His statements are supported by the Standard Bank statistics.
The theme for the Summit is “Brics and Africa – Partnership for Development, Integration and Industrialisation”.
In 2012, intra-BRICS trade reached $310 billion, up eleven-fold since 2002. “Today, intra-BRICS trade accounts for almost one-fifth of BRICS total trade with emerging markets, up from just 13 per cent in 2008. In contrast, the BRICS actually traded less with the EU last year than they did in 2008,” the report said.
The International Monetary Fund (IMF) has projected that 10 of the 20 fastest-growing economies during the next five years will be in sub-Saharan Africa and two will be in North Africa.
While average GDP for the continent grew at five per cent in the past two years, the IMF is forecasting growth of around 5.8 per cent in 2013 and 5.7 per cent in 2014, making the continent the world’s second-fastest growing region.
According to the McKinsey Quarterly business journal “real GDP rose by 4.9 per cent a year from 2000 through 2008, more than twice its pace in the 1980s and ’90s.
Telecommunications, banking, and retailing are flourishing. Construction is booming. Private-investment inflows are surging.”
The World Bank says that such growth is “quickly changing lives, driving entrepreneurship fueled in part by collaborative technology hubs, and delivering innovation and home-grown solutions for Africa”.
The report singled out South Africa’s growth as a result of its trade with fellow BRICS members.
“A decade ago trade with the BRIC economies accounted for just 5 per cent of South Africa’s total trade with the world. In 2012, this figure stood at 19 per cent.
Last year, South Africa’s exports to its fellow BRICS economies increased by almost 17 per cent,” the report said.
South African officials agree: “South Africa’s membership of the BRICS forum has become a vital element of our global economic strategy, and as the incoming BRICS chair, South Africa will play a key role in shaping the agenda for economic cooperation,” said Rob Davies, the South African minister of trade and industry.
South African President Jacob Zuma has made trade within BRICS and in cooperation with the rest of the continent a priority for his cabinet’s plans to boost employment in the country.
“We realise that intra-trade is not enough and are working hard on that,” Zuma said at Davos last month.