SA faces a dilemma in BRICS deals
AS SOUTH Africans, we tend to be overly negative about what we have to offer the world, either depicting ourselves as the small “s” in BRICS, or as the lesser of the five great emerging economies.
What I took away from the BRICS Summit this week was that South Africa has huge potential, and we just have to believe in ourselves.
One anecdote that stood out for me was an example Minister of Trade and Industry Rob Davies shared at the start of the summit.
He talked about the fact that the second best performing branch of Hisense, a large Chinese manufacturer of TVs and household appliances, is in South Africa.
The Chinese manager of
Hisense, based in Cape Town, told Davies their top performing branch is in the US, then in South Africa.
That shocked me as all we tend to hear are complaints that South African labour is too costly, investors are put off by the lack of physical security, our bureaucratic red tape is onerous and our workers don’t have the same work ethic as those in Asia. But that the South African branch of Hisense is one of the best performing branches in the world says a lot about our capabilities as a workforce and the investment environment here. This is truly something to celebrate.
What I also found remarkable was that this week was the first time in many years a new car manufacturing plant has opened here. This is why the opening of the Beijing Automotive Group plant in Port Elizabeth on Tuesday was celebrated with such fanfare, with President Cyril Ramaphosa and President Xi Jinping inaugurating the launch via video conference.
Davies hailed it as the biggest single investment in our auto sector. The plant will create at least 800 jobs in the Nelson Mandela Bay area and aims to produce 50 000 vehicles a year by 2022. The speed at which this project moved from conceptualisation to fruition is also incredible. The project to establish the plant was agreed and signed on the state visit of the Chinese president in December 2015, and it took only two and a half years to get to the launch with new cars rolling off the assembly line this week.
This indicates Chinese promises of investment and commitment to manufacturing projects are reliable, delivered timeously and outdo expectations. This should set the stage for South Africa to become a manufacturing hub for the African continent, particularly of vehicles, auto-parts, and even railway carriages. This is the vision of our policy makers, and there is no reason it can’t be realised. The extensive new infrastructure being rolled out across the continent will greatly facilitate intra-African trade, and assist us to build economies of scale.
Africa still desperately needs infrastructure beyond major urban centres to raise the living standards of its people. So the successful track record of the BRICS NDB should be hailed as it will enable South Africa and, eventually other African states, to access funding for infrastructure development.
As Dr Iqbal Surve, chairperson of the BRICS Business Council, noted this week, over the next few years the NDB will have provided more loans to BRICS countries than the World Bank did over 75 years. So those who talked down the summit’s significance, need to remember that behind the ceremonial talk is a very real commitment to enhance the development prospects of emerging economies. The pooling of intellectual capital, skills and resources are seen as a way to overcome poverty and underdevelopment.
Yes, there are BRICS members with less than acceptable human rights records, and more attention needs to be paid to this, but it doesn’t reduce the importance of what BRICS is trying to do for the developing south.
A difficult challenge for South Africa and our Department of International Relations is how to take forward a human rights foreign policy, while at the same time partnering for the sake of development with leaders who preside over human rights abuses with seeming impunity. This will require creative policy making in the future.
The Global spotlight will return on September 2.