5th BRICS Summit 2013
South Africa, the newest member hosted the 5th BRICS Summit from 26th to 28th March at the Durban International Convention Centre (ICC) under the theme “BRICS and Africa: Partnership for Development, Integration and Industrialization” This Summit completed the First Cycle of BRICS Summits and was the first time to be hosted in South Africa. And coincidently it coincides with the 50th anniversary celebrations of the African Union (AU).
This Summit was attended by BRICS heads of state South African President Jacob Zuma, Brazilian President Dilma Rousseff, Russian President Vladimir Putin, Indian Prime Minister Manmohan Singh, and Chinese President Xi Jinping. Apart from that several African organizations as well as non-BRICS leaders like Egyptian President Mohamed Morsi participated in the summit.
Highlights of Outcomes
This Summit had four focus areas.
- The Promotion of African infrastructure development
- The establishment of a BRICS-led development bank
- The establishment of a BRICS think-tank
- The establishment of a BRICS business council
- The BRICS Leaders agreed to the establishment of an exclusive bank-New Development Bank for themselves and developing countries. They indicated that the initial capital contribution to the bank should be substantial and sufficient for the bank to be effective in financing infrastructure. They were discussing about mobilizing 4.5 trillion US dollars over the next five years to target mainly infrastructure projects in its countries. The development bank can also borrow from other banks to pitch in with much-needed capital. The final document on establishing the bank will be ready by next year and from then on it could take a few years for the bank to start its operations.
- The contingent reserve arrangement (CRA) was established with an initial size of US $100 billion, which would help BRICS countries anticipate and forecast short-term liquidity pressures and further strengthen financial stability. China will contribute a share of 41 billion US dollars, followed by Brazil, Russia and India with 18 billion US dollars each, and South Africa with 5 billion. It would also strengthen the global financial safety net and complement existing international arrangements as an additional line of defense. Each country's central bank is supposed to keep the fund's reserves as part of its own reserves. The money is meant to be used in emergencies only, as an alternative to the International Monetary Fund. In this matter, the BRICS Leaders agreed to review progress made in these two initiatives at the next meeting of BRICS Finance Ministers and Central Bank Governors in September 2013.
- Under this Summit was the establishment of the BRICS Think Tanks Council and the BRICS Business Council was affirmed.
- The BRICS Think Tanks Council was launched prior to the Summit, which was nurtured by South Africa's Human Sciences Research Council (HSRC). The BRICS Think Tanks Council will link respective Think Tanks into a network to develop policy options like the evaluation and future long-term strategy for BRICS.
- BRICS Business Council was established on the eve of the summit. The BRICS Business Council will bring together business associations from each of the BRICS countries and manage engagement between the business communities on an on-going basis. BRICS Business Council, the key institution expected to drive private sector investments among the five members. The proposed council will meet twice a year and the chairmanship will rotate every year.
- These two new BRICS structures under the South African chairpersonship, that is, the BRICS Think Tanks and the BRICS Business Council, will strengthen intra-BRICS cooperation to develop new paradigms for sustainable and inclusive growth models, as well as new learning and knowledge paradigms to deal with our contemporary growth and development challenges.
New Areas of Co-operation to be explored:
- BRICS Public Diplomacy Forum
- BRICS Anti-Corruption Cooperation
- BRICS State Owned Companies & Enterprises
- National Agencies Responsible for Drug Control
- BRICS Virtual Secretariat
- BRICS Youth Policy Dialogue
- Sports and Mega Sporting Events