BRICS Institute spots gap in the market to foster economic ties

Johannesburg - As South Africa gears up to host the BRICS 2018 Summit in July, the BRICS Institute is hoping to introduce a new vehicle to foster greater country-to-country economic ties, with many of the relationships so far being geo-political in nature.

The BRICS Institute was launched on Thursday night at the Regenesys Business School in Sandton, with the aim of combining academic research and practical business cooperation.

The shine around the emergence of the bloc has dimmed somewhat, with questions about whether the five members - namely Brazil, Russia, India, China and South Africa - which are geographically and economically varied, will be able to create a new world order.

However, the potential for improved ties remains, with the five countries representing 23.6% of the world’s economy in 2017, and over 40% of the world’s population.

South Africa, which took on the rotating presidency of the club in 2018, is by all accounts the 'baby' of the bloc, with China, as the heavyweight, contributing almost two-thirds of the group's economic performance.

"[We] look at addressing a gap in the market… [using] an academic platform to drive commerciality,” Dr Julian Naidoo, head of the BRICS Institute, told journalists ahead of the launch on Thursday.

The think tank will lead several delegations of South African businesspeople to the other member states, during five intensive days of relationship fostering and introductions.

The cost of these trips will be R149 000 to a single destination, a figure that the BRICS Institute says will be well worth it, considering the high-level officials and business leaders delegates will be meeting.

Naidoo sees economic cooperation within the BRICS members as a way to develop South Africa’s comparative advantage, its abundance of natural resources and recent shift into financial services.

South Africa needs to bring in technologies to maximise the value of the raw materials and increase manufacturing and finished product output, according to Naidoo.

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