BRICS pledges to oppose protectionism
Xi to give $80 million for BRICS cooperation plans
China will give $80 million in funding for BRICS cooperation plans, Chinese President Xi Jinping said yesterday, while the bloc of five emerging countries pledged to oppose protectionism. Xi offered 500 million yuan ($76.4 million) for a BRICS economic and technology cooperation plan, and another $4 million for projects at the group’s New Development Bank (NDB) during a three-day leaders summit in the southeastern city of Xiamen.
China’s new contributions to BRICS pale in comparison to its $124 billion pledge earlier in May for Xi’s own Belt and Road initiative, which aims to expand links between Asia, Africa, Europe and beyond as a new way to boost global development.
The announcement came amid questions over the relevance of BRICS and China’s commitment to the NDB in light of the Belt and Road initiative and the Chinaled Asian Infrastructure Investment Bank, both key efforts by Beijing to bolster its global influence.
Xi said during a plenary session at the BRICS leaders’ summit that the five emerging economies - Brazil, Russia, India, China and South Africa - should increase cooperation in sectors such as trade and investment, monetary policy and finance, and sustainable development.
“We should redouble our efforts to comprehensively deepen BRICS partnerships and open BRICS cooperation,” he said. Set up in 20l5 as an alternative to the World Bank, the Shanghai-headquartered NDB was seen as the first major BRICS achievement after the group came together in 2009 to press for a bigger say in the post-World War Two financial order created by Western powers.
The BRICS leaders will gather in Xiamen through today, giving host China its latest chance to position itself as a bulwark of globalization in the face of US President Donald Trump’s “America First” agenda.
A draft “Xiamen Declaration” seen by Reuters, a formal version of which is expected to be issued later, said BRICS countries will continue to firmly oppose protectionism as they are committed to an “open and inclusive” multilateral trading system. The communique emphasized the need to be vigilant in guarding against “inward-looking policies” that could hurt global market confidence, and called upon all countries to fully implement the Paris climate agreement.
The summit has been overshadowed by North Korea’s sixth and most powerful nuclear test, which came on Sunday just hours before Xi opened the meeting with a keynote speech, and prompted a vow of a “massive” military response from the United States if it or its allies were threatened.
Open world
The BRICS group of emerging economies must promote trade liberalization and an open world economy, Chinese President Xi Jinping said at a business meeting on Sunday at the start of a three-day summit being held in southeastern China.
BRICS leaders will be joined by observer countries Thailand, Mexico, Egypt, Guinea and Tajikistan, and officials will discuss a “BRICS Plus” plan to possibly expand the bloc to new members. Mexico’s President Enrique Pena Nieto is set to be in China to discuss trade and investment, as Trump has renewed threats to scrap the 23-year-old North American Free Trade Agreement (NAFTA) that he has labelled a killer of US jobs. “We should push for an open world economy, promote trade liberalization and facilitation, jointly create a new global value chain, and realize a global economic rebalancing,” Xi told BRICS business leaders and senior officials. Xi said he still had “full confidence” in BRICS countries’ development despite claims that the bloc’s relevance had faded due to slower growth.
“The development of emerging market and developing countries won’t touch anyone’s cheese, but instead will diligently grow the world economic pie,” he said.
Earlier, Chinese vice trade minister, Wang Shouwen, said the BRICS meeting was expected to “reach consensus for actions” to oppose trade protectionism. He added that China was interested in possibly establishing a free trade agreement with Mexico.
In July, Xi called on members of the Group of 20 (G20) nations to champion an open world economy, and at the World Economic Forum in Davos, Switzerland, in January offered a vigorous defence of globalisation.
In Xiamen, Xi closed his 45-minute speech by saying that Beijing encouraged Chinese companies to continue going abroad, and “warmly welcomed” other countries’ firms to invest in the world’s second-largest economy.
Some have questioned the relevance of BRICS and China’s commitment to its New Development Bank (NDB) in light of Xi’s own global Belt and Road development initiative and the China-led Asian Infrastructure Investment Bank.
Set up in 2015 as an alternative to the World Bank, the Shanghai-headquartered NDB was seen as the first major BRICS achievement after the group came together in 2009 to press for a bigger say in the post-World War Two financial order created by Western powers.
The bank aims to address a massive infrastructure funding gap in the member countries, which account for almost half the world’s population and about a fifth of global economic output.
The NDB’s president on Friday said it aims to make about $4 billion in loans next year. To date, it has invested in 11 projects, lending $1.5 billion in 2016 and $2.5 billion in loans set for this year. — Reuters