At the heart of African priorities are development and inclusive growth, as articulated through the African Union’s (AU) Agenda 2063, adopted in 2013. One of the priorities for the first 10-year implementation plan (2014–2023) is that, by 2023, Africa’s gross domestic product (GDP) should be growing at 7% and at least a third of outputs should be generated by national firms through labour-intensive manufacturing. The flagship projects for this period include several core infrastructure developments and the creation of a continental free trade area.
Even preceding the articulation of Africa’s development priorities through Agenda 2063, former President Zuma emphasised at the BRICS’ Sanya summit in 2011 – South Africa’s first since joining the BRICS in 2010 - that the BRICS countries’ major savings pool could be channelled towards Africa’s demand for large-scale investments in infrastructure and manufacturing: ‘Over the next ten years, Africa will need $480 billion for infrastructure development, which should interest the BRICS business communities.’
The first BRICS summit hosted by South Africa in eThekwini in 2013 was titled ‘BRICS and Africa: Partnership for Development, Integration and Industrialisation’. At the summit, South Africa initiated a BRICS regional outreach mechanism and invited select African outreach leaders to participate in a dialogue with the other BRICS members. Infrastructure and industrialisation were high on the agenda.
In 2018, South Africa will again host a BRICS-Africa outreach under the theme ‘Working Towards Realisation of Africa’s Aspirations: Sustainable Development and Infrastructure Development’. Again, South Africa has invited several African countries to attend the BRICS-Africa dialogue on the last day of the Summit: the chairs of six Sub-Saharan Africa regional economic communities (Angola, Namibia, Burundi, Togo, Ethiopia, Uganda, and Gabon); Rwanda as the chair of the AU; and Senegal as the chair of the AU’s New Economic Partnership for Development.
Given the huge demand for infrastructure as an enabler of economic growth and development, the New Development Bank (NDB) has become an important focus of interest for Africans. South Africa had fought hard for the creation of the NDB and its first regional centre in Africa. Finance Minister Nhlanhla Nene stated in Parliament during the tabling of the NDB Appropriation Bill in October 2015 that the Bank would support both public and private sector infrastructure, regional projects and provide technical assistance for the preparation and implementation of these projects. A recent GEG Discussion Paper highlights that the NDB’ African Regional Centre (ARC) was widely welcomed by African stakeholders, who expressed the views that especially favourable credit terms and simplified project selection procedures should be priorities for the institution.
Another important consideration for the NDB and BRICS members, in particular China, India and South Africa who are among the largest bilateral creditors to African countries for infrastructure investments, is the transparency of loans. Between 2012 and 2016, the average debt-to-GDP ratio in Africa increased from 40.2% to 57.3%. For low income countries, the International Monetary Fund considers a debt-to-GDP ratio of between 30–50% as sustainable. The BRICS countries, their respective development finance institutions and the NDB should consider working with institutions such as the Infrastructure Consortium for Africa, which monitors infrastructure financing in Africa. African countries also have a responsibility towards creditors to be transparent about their credit status by reporting obligations to the same or similar initiatives.
In terms of facilitating greater cooperation between the BRICS and African regional institutions to support African priorities, respondents in the aforementioned GEG Africa study recognised the importance of better harmonisation, coordination and integration of bilateral BRICS country strategies with African counterparts with a longer-term strategic BRICS engagement. Creating dedicated and regular BRICS–Africa/developing country engagement forums that ensure continuity from one BRICS Presidency to the next was also seen as necessary. Some respondents mentioned the creation of a dedicated BRICS desk in these institutions to enable strategic and high-level engagement with the BRICS grouping on a continuous basis. Another proposal was to foster closer cooperation between BRICS and African researchers, aimed at identifying strategic opportunities for engagement on BRICS–Africa issues and developing country concerns.
As South Africa and its African counterparts meet the BRICs this week, there is significant benefit for all countries. Infrastructure and industrialisation will remain high on the agenda. African countries can further enhance cooperation with the BRICS by harmonising and coordinating institutional arrangements for cooperation with external partners.