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The 54 countries on the African continent can further industrialise and move up the value chain with the help from the BRICS (Brazil, Russia, India, China and South Africa), South African Trade and Industry Rob Davies said at the Sixth BRICS summit on Monday in Fortaleza, Brazil.
“If you take the simple example of coffee, Africa earns $6 billion a year from the coffee beans it grows, yet it is the roasters and blenders outside the continent who capture $94 billion of the value addition to those beans. That is unsustainable and if we want to promote sustainable inclusive growth, then more value addition has to place in Africa. That applies not only to coffee beans, but a whole variety of raw materials. The BRICS countries can help Africa to industrialise and lift millions out of poverty,” Davies said.
The theme of the 6th BRICS summit is “inclusive growth: sustainable solutions”.
“We can no longer rely on the commodity super cycle to lift prices and so support export values. That cycle ended in 2011 and most commodity prices today are below 2011 levels. African countries need to add value to the raw materials before they are exported and to do this we need to industrialise further and integrate so that we create a single market of one billion people,” he said.
In response to a question from The BRICS Post on the lack of progress on implementing the One Stop Border Post programme with South Africa’s neighbours, Davies said that South Africa could not bully its partners. It needed to be mutually beneficial and at a pace that was sometimes asymmetrical.
The One Stop Border Post programme with Mozambique for instance was agreed to in principle in 2007 and the physical facilities have been built at the Lebombo border post, but this is not a 24 hour operation.
Davies said the unilateral imposition of a ban on agricultural products by Zimbabwe would be brought up later this month when the Southern African Development Community (SADC), to which both South Africa belong, meets.
“There are SADC protocols that govern trade between member countries, so this will be on the agenda,” he said.
On the subject of Special Economic Zones (SEZ), Davies highlighted the experience of China and how their experience had promoted industrialisation.
“The SEZ legislation has been passed in South Africa and the SEZ at Saldanha been proclaimed. Dube Trade Port and Harrismith are on track and we are looking at two SEZs in the platinum belt so that we can turn the platinum into jewellery, autocatalysts and fuel cells. Chinese investment such as the FAW truck plant at Coega and the manganese sinter plant in the Northern Cape shows how cooperation between BRICS countries are mutually beneficial,” he concluded.
Helmo Preuss in Fortaleza for The BRICS Post
