The humidity and sub-tropical rain in South Africa’s port city of Durban is doing little to dampen the enthusiasm for the fifth BRICS summit, the first time the leaders of Brazil, Russia, India, China and South Africa have met in Africa yesterday, BBC informs. The largest emerging economies represent 25.9 pc of the world’s land mass, 43 pc of the population and 17 pc of global trade. The group also accounts for a quarter of the world’s gross domestic product (GDP) in terms of purchasing power parity. Indeed, a recent report from the United Nations Development Programme states that “by 2020, the combined economic output of three leading developing countries alone – Brazil, China and India – will surpass the aggregate production of Canada, France, Germany, Italy, the UK and the United States”. Enthusiasts will spend this week pointing to the latest woes of the Eurozone and the crisis in Cyprus, to give force to their argument that the fulcrum of world economics is changing and the BRICS are at the centre of that change.
There are also several other sources of tension between the BRICS on trade issues. China and India, which import vast amounts of commodities, want lower prices. The exporters of Brazil, Russia and South Africa want higher prices. One of the biggest conversations that is due to happen at the summit is about the possible foundation of a BRICS bank. There is a tremendous desire to set up a development bank that would aim to improve infrastructure within the BRICS nations. Part of this desire stems from a feeling of mistrust that the BRICS, particularly China, have towards established structures such as the International Monetary Fund (IMF) and the World Bank.