For the first time since the country joined the grouping in 2010, South Africa is hosting the BRICS Summit this year to be held from March 26-27. The Summit assumes much significance this time as a feasibility report on the proposed BRICS Development Bank will be presented to the leaders. Elizabeth Thabethe, South Africa’s deputy minister for trade and industry, in an interaction with Nayanima Basu it is a work in progress and the objective of the bank is not to replace any existing financial entity. Edited excerpts:
Will there be any announcement on proposed BRICS Development Bank in the upcoming summit?
The Ministers of Finance of the BRICS countries had been tasked at the 2012 Summit to look into the feasibility and viability of the proposed BRICS Development Bank. A report on the findings will be presented to the Leaders at the upcoming Summit, but I have to reiterate and reassure that it is not the intention for this proposed new development bank to replace any of the existing financing institutions. Its aim is to provide additional and also niche financing where it is not available or forthcoming, notably for Emerging Markets and Developing Economies in sectors critical for attaining their developmental goals.
So can we expect a formal declaration after presenting the feasibility report?
Establishing a Development Bank is not a small endeavour which is why the Leaders at the previous Summit requested the Ministers of Finance to thoroughly investigate all the aspects around the possibility of forming such an institution. This was taken very seriously and apart from being in regular contact electronically, the Ministers and their teams have met four times in committee in order to discuss this issue further. It is work in progress as there are still many issues with respect to such a Bank to sort out. One can expect further discussions and negotiations going forward.
What is the progress on India-SACU (South Africa Customs Union) preferential trade agreement (PTA)? This was supposed to have been signed last year.
India and South Africa have been discussing the formation of a PTA for quite a long time. Both are developing regions which have similar interests in terms of market access. Therefore, it was expected that the negotiations would be characterised by a process of give-and-take in which India, on the one hand, will have a specific sector that it wants SACU to open, whilst, on the other hand, SACU will have specific sectors that it wants India to open. There are certain sectors which both partners have identified as strategic industries and they both have to tread carefully when negotiating these.
So what problem is the deal facing now?
There is no problem as such. There are some hurdles, but these are being negotiated and I am confident that it will be resolved. I cannot put a deadline and say that it will be signed tomorrow but the process is ongoing and the chief trade negotiators have been requested to work to the earliest conclusion of the discussions as possible.
