Lateral Thinking

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South Africa is again looking outside of its neighbourhood to further boost trade ties and to reinforce its reputation as a country willing to do business far beyond its traditional markets.



The latest manifestation of this resolution to broaden its horizons was the meeting on September 11 to 13 of the India, Brazil and South Africa Dialogue Forum Trilateral Commission, held in the Brazilian capital, Brasilia.



South Africa's President Thabo Mbeki met with Indian Prime Minister Manmohan Singh and host President Luiz Inácio Lula da Silva of Brazil.



The impetus to set up what has become known as IBSA - India, Brazil, South Africa - came from the South African leader in 2003 as a means to boost economic, cultural and political ties. Since then, there have been a number of meetings at the ministerial level and the convening of summits of technical experts and representatives of the private sector.



Even before the Brasilia meeting, IBSA had borne fruit. South Africa's bilateral trade with India has increased 150% in the past three years, and now stands at just under $4bn a year, while business done with Brazil has hit almost $2bn. Overall, trade between the three countries is now worth $8bn, with expectations this will reach $10bn within two years. Put into context, IBSA, which has also been referred to as the G3, represents a market of more than 1.2bn people with a combined GDP of $1.8 trillion and trade volume in excess of $600bn.



However, though expanding, trade between the members of IBSA represented just 1.5% of their combined international figures, something all three leaders vowed to change. Each of the members of the bloc also see enhanced opportunities by using their IBSA partners as a portal through which to further penetrate their respective continents.



Addressing the summit, President Mbeki said that while it was important for countries such as theirs to continue to interact with developed nations it was also critical that developing countries accelerate the processes of their own development by harnessing common strengths.



"IBSA is an idea whose time has arrived," he said. "It is a necessary response to the current state of play in the global economy and its purpose and objectives are even more relevant in the context of the collapsed Doha development round of talks."



A significant lesson that had to be learnt from the failure of Doha was that countries of the south had to achieve rapid progress in implementing fair trade, economic development, job creation and poverty eradication, Mbeki said.



"These developing countries should first and foremost form strong partnerships and strategic alliances that would unlock the vast resources and economic opportunities within and between their countries and regions," he said. "Fortunately, India, Brazil and South Africa share a coincidence of interests in so far as we have common hopes, aspirations and challenges and through IBSA have created a platform from which we can attend to these many and varied challenges."



Some of these challenges were met in Brasilia with the signing of a series of agreements to develop co-operation on improved transportation and maritime services, agriculture, bio-fuels and information technologies.



On the sidelines of the main summit, there was a seminar attended by academics of all three countries to discuss measures by which cultural ties could be boosted. Proposals included setting up a news agency focusing on the three continents where IBSA were the driving forces.



Just the day before the opening of the summit in Brasilia, South African Deputy President Phumzile Mlambo-Ngcuka wrapped up a four-day visit to India, during which she described her host nation as one of South Africa's strategic partners. Though no major agreements or projects were signed off on, that being left to the government leaders gathering in Brazil, Mlambo-Ngcuka and her delegation laid further groundwork for closer co-operation in the future.



As the summit was taking place in Brazil, the three countries' ministers of science and technology met in Johannesburg to sign an agreement to set up a fund worth $300,000 annually in each country to support research and development projects that have potential for industrial applications that are of mutual interest. The objective of the scheme was described as being a platform capable of enhancing the competitive advantage of South Africa, Brazil and India.



As expected, no binding free trade agreement was reached at the Brasilia meeting, though all three countries have said they favour bringing down the barriers between them.


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