South Asia

BRICS Builds Global Balance

Tao Wenzhao

Beijing (Xinhuanet): The third summit meeting of BRICS countries is due to be held at China’s resort city of Sanya later this week.

South Africa will join Brazil, Russia, India and China at this year’s summit, where the participating leaders are expected to exchange ideas on economic and financial issues.

The continuing rise of developing nations, such as those of the newly enlarged BRICS, marks a significant change in the global economic and political landscapes and will have a far-reaching influence on world development.

Under the West-dominated international political and economic system, global wealth and power have been unevenly distributed between developed and developing countries for a long time. However, some subtle changes have occurred over the past two decades, especially since the outbreak of the global financial crisis in 2008.

The US economy seems to be on the road to recovery, but the unemployment rate in the world’s largest economy is still around 8.5 percent and its financial deficit remains high. European countries are struggling to grapple with a lingering sovereign debt crisis and Japan, which has failed to completely extricate itself from its decades-long economic stagnation, must recover from the recent earthquake and tsunami.

In sharp contrast, developing countries have overcome the impact of the global financial crisis and managed to achieve robust economic growth momentum. According to an estimate by the International Monetary Fund (IMF), economic growth in emerging countries reached 7.1 percent in 2010 and is expected to be 6.4 percent in 2011.

That the global economy has managed to avoid a widespread recession like the one in the 1920s and 1930s should be partly attributed to macroeconomic policy coordination among world members and their concerted efforts to resist protectionism. The robust growth momentum from some emerging markets has also played a very important role in pulling the global economy out of what would otherwise have been a deep slump.

Due to the rise of some emerging economies, global wealth is developing in a more balanced direction. Two decades ago, the G7 industrialized countries accounted for more than 70 percent of the world’s economic output, but now they account for 50 percent. Compared with the decline in the economic clout of developed nations, developing countries are enjoying a growing proportion of the world’s economy.

The most important influence that emerging countries like the BRICS nations have on world politics is their participation in global efforts for good governance.

In the post-Cold War period, the international community faces a series of global threats and challenges, ranging from natural disasters and epidemics to terrorism and the proliferation of weapons of mass destruction. Avoiding economic and financial crises are also an acute challenge to world members. To better resolve these issues, cooperation among all world members are desperately needed. At the Pittsburgh Summit held in September 2009, G20 countries reached a consensus to replace the G7 with the G20 as the main channel to resolve global economic and financial issues, a move that reflects the fact that not only developed countries, but also cooperation between developed nations and emerging economies are badly needed to tackle some major global issues.

BRICS members, as the main representatives of developing countries, have played an irreplaceable role in the handling of global financial and economic issues. The increased votes and representation extended by the IMF and the World Bank to some emerging economies have underscored this tendency. It also marks the first step of the international society toward reforming the long-controversial international financial system.

As part of their active participation in global efforts to create good governance, emerging countries have joined international efforts to deal with climate change since the early 1990s and helped sign the United Nations Framework Convention on Climate Change (UNFCCC), the Kyoto Protocol and other documents. However, a handful of documents alone are not enough to deal with climate change, a complex issue that can only be resolved under a new global international mechanism.

BRIC nations played a very important role at the Copenhagen and Cancun conferences and will continue to play their role.

The rise of emerging countries is expected to help set up a more just and reasonable international political and economic order.

While facilitating world economic development, globalization has also brought varying effects to different countries, aggravating the polarization of global wealth between the rich and poor nations. The emergence of some developing countries as a group is a result of their unremitting efforts at self-development over the past decades.

Undoubtedly, their development experiences, successful or unsuccessful, will offer helpful lessons for other developing countries. At the same time, their global governance efforts, which will take into consideration the interests of developing nations, will promote global economic development in a more balanced manner and push international relations in a more reasonable direction.

It is expected that the Sanya Summit will enhance consensuses among BRICS countries, strengthen mutual coordination and deepen mutual cooperation to help the group play a bigger role in international affairs.

(The author is a senior researcher with the Center for US-China Relations at Tsinghua University)

 

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