South Africa lags in trade negotiations while BRICS peers advance. Urgent action is needed to secure its economic future amid shifting global markets. Among the original BRICS countries, South Africa seems to be the only one not moving with urgency to open new export markets.
Most members — notably India, China, and Brazil — have entered into free trade agreements to better position themselves within a shifting global landscape that demands diversified export markets. As The Economist magazinepoints out, “India has closed three trade agreements since the middle of last year: with Britain, New Zealand and Oman.” Moreover, India may soon announce a free trade agreement with the European Union (EU). It has already agreed to significantly reduce tariffs on cars from the EU, a sign that a deal may be announced in the coming days.
Additionally, it has been reported that India may soon start trade talks with Canada. Brazil has also seen some success. As a member of the Southern Common Market (Mercosur) — alongside Argentina, Bolivia, Paraguay and Uruguay — Brazil stands to gain significant EU market access for its farmers through the new EU-Mercosur trade agreement.
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These farm products will probably pose new competition for South African exports to the EU. China has also not been standing still; it is in trade talks with Canada, and many more countries are engaging with China to gain market access for their products. Clearly, the BRICS members are engaged in trade talks with countries outside the grouping.
South Africa should also embark on this path, focusing more intently on expanding exports to greater Asia and the Middle East. Similarly, South Africa should prioritise trade negotiations within the BRICS bloc to secure a formal trade agreement, as deeper economic integration is vital for the group’s long-term stability. Currently, BRICS is focused on high-level political and geopolitical matters, which are important but not sufficient.
Ultimately, the citizens of each BRICS member will ask, “What are the economic benefits of this grouping?” If trade matters are not elevated, it becomes difficult to answer such questions, and even more difficult to consider the bloc’s longevity, when its members feel there is limited benefit to belonging to it. Significantly, South Africa has long been reflecting on its export diversification strategy and has elevated the discussion following the announcement of the “Liberation Day” tariffs in the US. In the past few months, South African political leaders have visited several Asian and Middle Eastern countries, all of which are key to long-term market access for South African products.
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