Tuesday, May 23, 2006
Is it all about trade?
So globalization is the buzz word on our team blog. There’s no doubt about the opportunities and challenges that have been facing our continent due to this rapid advance of technology, information and communication. And it fuels the discussions around our team blog topic, African development.
What better way to fight the negative impacts of globalisation than South-South cooperation. The reasons for South-South relations are simple: Growing tension between the South and the North should be restored; the South should no longer depend heavily on the North; and to promote southern economic development by opposing unjust political, economic and social international order in the 21st century.
Let me come to the point I’m trying to make. IBSA is one of the new forces to help do all of the things I mentioned above. IBSA is the India, Brazil, and South Africa Dialogue. This dialogue is a means to address various issues including trade and investment, science and technology, education, health, poverty, etc.
Some of the future targets of IBSA are the following:
- Establish sophisticated relations two enhance South-South cooperation
- Strengthen the southern voice in international organizations to make it more democratic and representative.
- Promote South-South trade (boost investments from +/- $4.6 billion to $ 10 billion in 2007).
- Cut down North tariffs and agricultural subsidies like that of the US and the Common Agricultural Policy of the EU.
But is it all about trade?
I think we should not look at only trade to determine the success of IBSA. It is plain to see that trade between these nations are not complementary. I have no stats to prove this but I have read that Mercosur’s exports to SA are almost five times bigger than ours. And even though we export basic commodities to Mercosur, their value-added products are starting to dominate our market.
(Just to be clear about Mercosur, it is the regional partnership between Brazil, Argentina, Uruguay, and Paraguay).
So I asked myself what should be the main determinant for the success of IBSA and what makes it so necessary? All three these nations have to stick together to prove that South-South relations is important for the well-being of the southern nations. Also, IBSA is an alliance to meeting the challenges of poverty and development, two major trends occurring in these three nations. Many assume the dialogue is purely based on trade. But IBSA has started a poverty plan for the three nations and for the rest of the southern countries who are in need. It is called the IBSA Facility for Hunger and Poverty Alleviation. All three IBSA members have committed $ 1 million each every year to be able to help the facility grow and be successful.
Many are skeptical about this partnership, and justifiably so. Because it’s such a young agreement, it is difficult to see the progress made. But in the end of the day, South-South cooperation has been a failure in the past and was in a haphazard state. IBSA is a new approach which can enhance the relations between southern nations, so why not embrace it.
Do people think IBSA is a lot of hot air? Some comments on this topic will be great. It will also be quite interesting to talk about the agricultural relations between these nations. Looking forward to some debating.