Ladies and gentlemen,
Let me also extend my profound gratitude to the Conference organisers for the opportunity to participate in this Roundtable and to interact with the distinguished audience present here today.
The theme of our panel discussion is the “EU and emerging powers”. This topic is pertinent in the current global conjuncture which is characterised by increasing multipolarity manifesting in the diffusion of economic and political power. The term emerging powers is now commonly associated with the BRICS countries, a new platform for dialogue and cooperation amongst emerging/re-emerging countries that represent approximately 43% of the world’s population, aimed at the promotion of development in a multi-polar, inter-dependent and increasingly complex, globalising world.
These countries, which have a burgeoning middle class and huge market sizes, account for approximately one fifth of global gross domestic product (GDP), estimated at US$13,7 trillion, and have combined foreign reserves estimated at US$4,4 trillion. In 2012, BRICS accounted for approximately 11% of global annual foreign direct investment (FDI) flows (US$465 billion) and approximately 17% of world trade.
The significance of BRICS in the global political and economic system can therefore not be overemphasised. The recent international economic-financial crisis has demonstrated that the interdependence between the developed economies and the emerging ones is beneficial for the stability of the international financial and trading system, with emerging economies at the forefront of the global economic recovery and development.
The European Union has strategic partnerships with every state of the BRICS, focussed not only on trade but on dialogue and cooperation at a bilateral and multilateral level covering a wide-range of issues from the protection of environment, migration, security, to the reform of the multilateral system of governance and the global financial architecture.
In spite of the on-going Eurozone crisis, the EU continues to occupy an important place in the trade agendas of BRICS countries as it remains a key trade partner. At the same time, the BRICS offer significant opportunities for EU’s exports.
The EU, its key member states and the BRICS are members of the G-20, which collectively brings together systemically important advanced and emerging countries that represent 85% of global GDP and two-thirds of the world’s population. At the height of the global financial and economic crisis, the collective action of the G-20 helped to restore confidence and stability in the global economy.
BRICS Member States share and ascribe to universal core values which were already pronounced at the Ministerial meeting in 2008, and I quote:
“The Ministers emphasized the prospects of the BRIC dialogue based on mutual trust and respect, common interests, coincidence or similarity of approaches toward the pressing problems of global development. The Ministers agreed that building a more democratic international system founded on the rule of law and multilateral diplomacy is an imperative of our time. They reaffirmed the commitment of the BRICS to work together and with other states in order to strengthen international security and stability, ensure equal opportunities for development to all countries. The Ministers reiterated that today’s world order should be based on the rule of international law and the strengthening of multilateralism with the United Nations playing the central role. They reaffirmed the need for a comprehensive reform of the UN with a view to make it more efficient so that it can deal with the current global challenges more effectively.’
These underlying shared values are the leitmotif, the golden thread that brings BRICS countries together for the common purpose of writing a new script for the world’s development.
For its part, the EU through Article 10, Chapter 1 of the Lisbon Treaty seeks to “…advance democracy, the rule of law, the universality and indivisibility of human rights and fundamental freedoms, respect for human dignity, the principle of equality and solidarity, and respect for the principles of the UN Charter and international law.” It goes further to state that, “the Union shall seek to develop relations and build partnerships with third countries and international, regional and global organisations which share the principles referred to in the first sub paragraph.”
From the above, it is evident that BRICS and the EU have common concerns, responsibilities, and share a common vision for the development of the world.
As previous speakers have mentioned, at the 5th BRICS Summit held in Durban South Africa last month, the Leaders announced the establishment of a New Development Bank and directed that the initial capital contribution to the bank should be substantial and sufficient for the bank to be effective in financing infrastructure. The initial size of the fund is estimated at US$100 billion, subject to internal legal frameworks and appropriate safeguards.
The establishment of a self-managed contingent reserve arrangement would have a positive precautionary effect, help BRICS countries forestall short-term liquidity pressures, provide mutual support and further strengthen financial stability.
The Bank would not compete with the existing establishments, but would contribute to strengthening the global financial safety net and complement existing international arrangements as an additional line of defence.
The significance of this decision cannot be overemphasised. It reflects the enormous successes in economic development during the last four decades (the BRICS’ aggregate GDP is now greater than that of the advanced countries when the Bretton Woods institutions were founded) and the rebalancing of global economic power that this implies. Indeed, the decision demonstrates the BRICS’ ability and willingness to work together, for the benefit of the entire world.
A new development bank is clearly needed. The infrastructure requirements alone in emerging-market economies and low-income countries are huge – 1.4 billion people still have no reliable electricity, 900 million lack access to clean water, and 2.6 billion do not have adequate sanitation. At the same time, an estimated two billion people will move to cities in the next quarter-century.
The BRICS bank will make a major contribution to the global economy’s health by facilitating the transition to new poles of growth and demand, helping to rebalance global savings and investments, and channeling excess liquidity to productive use. It will not only be a driver for sustainable growth in the developing and emerging world, but will also foster reform in the existing multilateral financial institutions – changes from which all of us, in the developed and developing world alike, will benefit.
With regards to the international trading system, BRICS has reaffirmed its support for an open, transparent and rules-based multilateral trading system. BRICS will continue its efforts for the successful conclusion of the Doha Round, based on the progress made and in keeping with its mandate, while upholding the principles of transparency, inclusiveness and multilateralism. BRICS is committed to ensure that new proposals and approaches to the Doha Round negotiations reinforce the core principles and the developmental mandate of the Doha Round. In this regard, BRICS looks forward to significant and meaningful deliverables that are balanced and address key development concerns of the poorest and most vulnerable WTO members.
At the Durban Summit BRICS also reaffirmed the United Nations Conference on Trade and Development’s (UNCTAD) mandate as the focal point in the UN system dedicated to consider the interrelated issues of trade, investment, finance and technology from a development perspective. UNCTAD’s mandate and work are unique and necessary to deal with the challenges of development and growth in the increasingly interdependent global economy.
On climate change, as BRICS countries we welcome the outcomes of the UN Conference on Sustainable Development (Rio+20) in June 2012 as reflected in “The Future we Want”, in particular, the reaffirmation of the Rio Principles and political commitment made towards sustainable development and poverty eradication while creating opportunities for BRICS partners to engage and cooperate in the development of the future Sustainable Development Goals.
While acknowledging that climate change is one of the greatest challenges and threats towards achieving sustainable development, we call on all parties to build on the decisions adopted in COP18/CMP8 in Doha, with a view to reaching a successful conclusion by 2015.
BRICS countries have reiterated their strong commitment to the United Nations (UN) as the foremost multilateral forum entrusted with bringing about hope, peace, order and sustainable development to the world. The UN enjoys universal membership and is at the centre of global governance and multilateralism. In this regard, the need for a comprehensive reform of the UN, including its Security Council, with a view to making it more representative, effective and efficient, so that it can be more responsive to global challenges can never be over-emphasised.
BRICS countries further underscore their commitment to work together in the UN to continue cooperation and strengthen multilateral approaches in international relations based on the rule of law and anchored in the Charter of the United Nations.
My parting shot is, BRICS is not a threat, it is not a juggernaut, but it is an opportunity for Europe, it is a force for positive change, and the EU should engage this grouping of emerging countries in order to promote development and ensure prosperity for all!
Faced with the current uncertainty in the global economy, the EU and BRICS need one another,and should leverage their collective strengths and comparative advantages for the good of their people’s and for sake of the global economy and humanity!
Surely if we can engage in strategic partnerships at bilateral level, we can build a similar partnership at multilateral level.
I thank you for your attention.