Address by the ANC Treasurer-General, Mathews Phosa, delivered at the ANC Progressive Business Forums Brics Colloquium held at Gallagher Estate, Midrand, Johannesburg

25 June 2012

During the past few years, much attention has been given to the growth prospects of Brazil, Russia, India, China and South Africa (BRICS for short).

BRICS account for more than 40 per cent of the global population and a share of world GDP that has increased from 16 per cent in 2000 to around 25 per cent recently.

The BRICS countries are culturally and geographically diverse but nonetheless, due to many complementary benefits, resources and economic advantages are expected to play a major role as growth drivers in the world economy. The world economy is in a state of flux and a shift is taking place in favour of the emerging economies.

Their central position in the global recovery has placed them in a leadership role for the future and that is why South Africas role in this global entity is so significant

It is the global centrality of the BRICS economies that makes todays engagement timeous and relevant.

A number of practical initiatives are under way. At the New Delhi Summit held in March 2012, the BRICS announced the future launch of a new Development Bank to fund development and infrastructure.

It is also envisaged that The Bank will lend and issue convertible debt as well as provide a vehicle for improvement of trade opportunities between the member countries.

The BRICS have formally agreed to promote trade in local currencies and have signed a Master Agreement on Extending Credit Facility in Local Currency and the Multilateral Letter of Credit Confirmation Facility Agreement, to replace the United States dollar as the main unit of trade between the parties.

Additionally, in order to bring the economies of BRICS closer, a benchmark equity index derivative is to be launched allowing investors in one BRICS country to bet on the performance of stock markets in the other four members without currency risk. The indices will be cross-listed in BRICS` flagship stock exchanges.

Underlying all of the above is a growing view that emerging economies should shape their own future, create their own institutions and co-operate on better terms with other multi-lateral institutions.

It is these practical issues that we would like to flesh out and further shape today.

From a business perspective, what are the barriers that need to be removed, mechanisms that need to be put in place to give practical effect to the political pact that has been formed between these formidable partners and players?

BRICS is an emerging economic force to be reckoned with; and our respective governments have firmly backed, and are hard at work in shaping BRICS in such a fashion that it works to the benefit of our people.

There are principles that will guide is in this partnership such as shaping our own future, creating workable partnerships and multi-lateral institutions aimed at relieving our over reliance on external and expensive partnerships and institutions.

I also see the BRICS initiative as part of an approach that is informed by the fact that our political liberation should now be broadened and our economic liberation given real roots. We can only do so if we choose our global partners wisely, and with own and common interest at heart.

We have the levers of government at our disposal and our only enemy is poverty and more jobs.

Let us, through BRICS and other initiatives, shape our environment into a better place for all to live in, and do business in.

That is what todays Colloquium is about. I hope it will make a small contribution in further deepening the cohesion between the political and business leaders of our participating nations.

I thank you.