Connect with us

Economy

BRICS acts as a collective will to safeguard global multilateralism

Published

on

Authors: Zhou Dong chen &Francis Kwesi Kyirewiah*

On November 13-14, the 11th BRICS Summit was held in Brasilia, capital of Brazil, where Chinese President Xi Jinping alongside the leaders of Russia, India, South Africa and the host country—Brazil—met and discussed the issues of global and regional dimensions. According to the data in 2018, the BRICS member states have already accounted for 23.6% of the world economy (GDP) and nearly 20% of all world trade, in addition to contributing more than half of all global economic growth. Now, as it enters the second decade of cooperation, BRICS aims to enhance intra-bloc cooperation covering all economic, political and security cooperation as well as cultural and people-to-people exchanges. Can the BRICS members stand together in international affairs?

The concept of the “BRIC” came to the limelight in 2001. Since then, it is argued that the relative size and share of those countries in the world economy has risen exponentially, and most likely it would gradually imply that the G7’s economic hegemony would be rearranged. Scholars like Dominic Wilson further echoed this in his study on “Dreaming with BRICS: The Path to 2050”. He put it that, in all likelihood, by 2025 the BRICS could account for over half of the size of the G7 in terms of GDP. And in less than 40 years the BRICS’ economies together could be larger than the G7.

Although it was debatable, the key assumption behind all the discourse is that China and India have risen as the world’s principal suppliers of manufactured goods and services, while Brazil and Russia are already becoming equally dominant as suppliers of raw materials.In addition, what the BRICS have in common is that they all have an enormous potential consumer market, complemented by access to regional markets and to a large labor force. Wilson argues that three key issues the BRICs have to embrace for their partnership development are as follows: Inclusive growth, sustainable solutions and foreign policy consultations in the post-Western world. Echoing his discourse, Andrew Hurrell put it, “since all the BRICS nations are now members of the G20 which is a major symbol of the structure of global governance, the bargaining power of the BRICS vis-à-vis US-dominated global institutions is inevitably growing.”

It is quite coincident that during the 2017 G20 Summit in Germany, the leaders of the BRICS held an informal meeting reaching key agreements on building an open world economy and improving global economic governance. On the occasion, Chinese leader called on that the BRICS itself would establish an open economy, maintain a multilateral trade system and advance inclusive, balanced and win-win economic globalization with a view to making the fruits of economic growth accessible for all people. There is no doubt that the BRICS countries also have their own internal challenges and external divergences on many issues. Yet, the central point of the role of the BRICS in global affairs is not where the world order is now, but where it will be in the near future, say by 2050.Building on the common sense that “a shared voice is stronger than a single shout”, the emerging powers are well-aware of the closer cooperation among them and even beyond in order to push forward their own agenda.

Yet,  no matter which theory, realism or constructivism, is used to assess the BRICS, it is unlikely the bloc having moved to a geopolitical organization like NATO, but only a new-typed geo-economic forum that incorporates a strong component of people-to-people relations between institutions and individuals. Two of its main goals are as follows: to bring people closer together through socio-economic means, and to take a constructive part in settling geopolitical flashpoints. As such, the BRICs is generally regarded inclusive and its members are willing to cooperate with other countries or institutions that share their interest in making the world a fairer, and therefore a better place. In line with this spirit, the BRICS, though a grouping of five major emerging national economies, aims from its inception to establish an equitable, democratic and multilateralism-based world order.

If the first decade of the BRICS has formalized its existence and also represented many opportunities for the 21st century, the key concern remains how to turn the bloc into a functional grouping rather than just a global forum in the next decade. Strategically, it is vital for the BRICS to become a knowledge base for other developing countries, such as the areas of solar energy, ethanol products, urban landscape development, slum alleviation and biotechnology use, and share their best practices with southern countries. To that end, it is essential for the BRICS to act and talk differently from the G7 and other Western institutions, which are deemed to retain economic hegemony over the vast developing areas. Put it more bluntly, the BRICS should be committed to multilateralism, human development and social welfare in accordance with UN charters and the relevant resolutions.

Given this, looking ahead into the next decade, the BRICS is supposed to follow this line as proposed by Xi when he addressed the current global challenges such as unilateralism and protectionism, and he called on BRICS countries to champion and practice multilateralism. Thus he put three-point suggestions as follows: first, he urged the five members to safeguard peace and development for all, uphold fairness and justice and promote win-win results. Globally, it is vital for the BRICS to uphold the purposes and principles of the UN Charter and the UN-centered international system, which rejects any sort of hegemonic order and power politics and take a constructive part in settling geopolitical issues.

Second, the BRICS en bloc should pursue greater development prospects through openness and innovation. Therefore, it should uphold the WTO-centered multilateral trading system and increase the voice and influence of emerging markets and developing countries in international affairs. In addition, BRICS member states should prioritize development in the global macro policy framework, follow through the UN 2030 Agenda for Sustainable Development and the Paris Agreement on climate change. All in all, the BRICS makes all efforts to promote coordinated progress in the economic, social and environmental spheres. Third, in a long run, the BRICS needs to be more proactive in promoting mutual learning through people-to-people exchanges and take their people-to-people exchanges to greater breadth and depth. Xi did indeed appeal to other four partners that “BRICS Plus” should serve as a platform to increase dialogue with other countries and civilizations to win BRICS more friends and partners.

This is a truly strategic proposal. People agree that the next decade will see accelerating change in global patterns of economic growth, development, and governance. The BRICS can achieve a second golden decade if they can remain united and work together in the face of the challenges and opportunities to come. Although all BRICS members have no intention to challenge the status quo which is still dominated by the U.S.-led globalization system, the first decade of self-discovery of the BRICS has paved the way for the second decade of confident outreaches to other countries and institutions and will predictably see the new bloc becoming a powerful global platform for change by 2029.

In summary, the huge potentials of the BRICS are far beyond the current five powers. In effect, Valdai Club, a Russia’s top think tank, once put it, the BRICS starts by bringing together the regional integration groups that each country is a part of (e.g. Russia, the Eurasian Economic Union, Brazil and Mercosur) through the BRICS+ framework in order to broaden its reach in the most realistic way possible without overextending itself. In view of its one-decade vicissitude, it can say that this visionary outlook is definitely doable since all the BRICS members certainly have the political will to pull it off, plus their combined economic power is attractive enough to naturally make their counterparts interested in cooperating. The BRICS could therefore transform into the core of a larger global reform structure bringing together non-Western countries and even those within the West that are dissatisfied with the U.S.-led status quo, which would then enable it to truly become a global force capable of carrying out meaningful development governance. It has actually exercised a positive impact on each of its five members, so it’s time to spread the benefits beyond the original five. Considering the second decade of its development, the BRICS would aim to make further reform in terms of the fairer governance.

*Francis Kwesi Kyirewiah, a PhD student in International Affairs, at SIPA, Jilin University, China.

Continue Reading
Comments

Economy

Transformation of E-Commerce Businesses and their Future after COVID-19

Ehtisham Ali

Published

on

World has witnessed an unprecedented human destruction caused by Covid-19.As on 7th July 2020, the virus has taken 533,780 lives and 11,419,529 have been tested positive worldwide. It started in December 2019 when Wuhan Municipal Health Commission China reported cluster of pneumonia cases which was eventually identified as novel coronavirus. On 5th January 2020, World Health Organization (WHO) made a flagship technical publication for Global Media as well as scientific and health communities on the first ever aperture on disease outbreak of new virus. Later on WHO declared health emergency worldwide and issued public health advisory when a large number of cases were reported outside China.

Subsequently, governments across the globe started taking precautionary measures to contain the infection rate which included lockdowns, border restrictions and even economic activities were strictly restricted. People themselves started opting for social distancing to avoid potential contagion and physical proximity. On the one hand this strategy has proved as the best measure to reduce the rate of infection but on the other, due to minimal economic activities, economies of many countries have been badly affected. Barring essential businesses like food and grocery etc., every other business got effected. Thousands of traditional style businesses and companies were severely affected and lot of them even went bankrupt.

In these circumstances, E-Commerce appeared as a promising major pillar in fight againstCOVID-19 as it helped reduce the rate of infection by offering online delivery of commodities and services. Supermarkets started online delivery of groceries by providing door-to-door services to their customers, preventing risks of in-store visits and subsequently online payments obviated in-person cash transactions.

Moreover, E-Commerce helped economies in preserving jobs during crisis. Online businesses strived to maintain the basic revenue stream which helped them to get their businesses afloat through the crisis. Restaurants and famous food chains started offering online takeout services. Almost all famous brands of clothing, shoes and many others, transformed their business from traditional to online.

Many companies changed the nature of their businesses and were successful in creating new jobs as consumers shifted towards online offerings. Recently a Dubai based raw coffee supply company transformed its business from B2B to B2C due to emerging demand of consumer products.

Interestingly many new small level ventures were set up during this period. People started delivering homemade food and home grown fruits and vegetables to meet the needs at both ends and the response from their customers is most encouraging. These continued availability of consumer goods helped the governments to increase the acceptance of persistent physical social distancing measures among masses.

Lockdown orders will definitely be lifted eventually but there are thousands and millions of customers whose patterns of purchase have changed drastically for a more comfortable way of getting what you need at your doorstep. They are comfortable with the online system not only for their convenience but also for getting into any risk of catching the virus. According to a recent survey on social media, young consumers are more motivated than ever to maintain social distancing and shop online while staying at home. This trend is creating ideal market conditions and great motivation for newly entrant digital entrepreneurs.

The trend of changing customers’ buying habits and behavior is an opportunity for digital entrepreneurs. Now how they react,it is the future of e-commerce that will be the deciding factor. Once the situation improves, sales of E-Commerce industry may stabilize at low growth rate than today but the changing behavior of customers is already in action to overall change the retail and commerce for years to come.  

Continue Reading

Economy

Covid-19 Create more Challenges for Industrial Special Economic Zones (SEZ) in Pakistan

Mohsin Rasheed

Published

on

China Pakistan economic corridor CPEC is biggest achievement and effective agreement between Pakistan and china. CPEC is refereed as innovative project also a big achievement for Pakistan and also a beneficial for china. There are many Special economic zones developing in Pakistan but Nowadays, Covid-19 is increasing rapidly in Pakistan. Extremely a very bad situation of Pakistan economy as well as global economy due to this pandemic situation. Corona virus effects many business and major Flagship project CPEC development due to shortage of workers.

During CPEC developing there are many internal or external challenges between china and Pakistan towards CPEC project and industrial zones other than corona virus. The route is 2000 km long starts from Kashgar (North western china) to Pakistan Gwadar. This route have many various economic industrial zones, energy plants, infrastructure routes and cable connections. They proposed 37 economic zones in Pakistan but only 9 economic zones are prioritized to be established.

This all development and innovation is will highly effective for economic steadiness but there are some many challenges faced by china and Pakistan between CPEC project such as energy shortage and infrastructure projects. The future expectation of both countries are very big in count in case of development and innovation. Pakistan is also importing innovation from china with a help of various projects. CPEC is game challenger project for Pakistani and its project worth is $64 Billion. CPEC is overcoming challenges for making more innovating Corridor between Pakistan and china.

Pakistanis is still under develop country and seeking more innovation from china through China Pakistan economic corridor (CPEC). CPEC is a great opportunity for Pakistan to enhance the economy development in a right way and boost the infrastructure and energy sector. CPEC is a part of (One Belt One Road) OBOR the global project of XI JIMPING.  CPEC helps to china to trade with global regions of east and west routes.

As we all know CPEC is an innovative Project between China Pakistan, firstly I have figure out issues between CPEC project, actual need of development, Project orientation, unemployment, education sector, water shortage, energy issues, development projects such as energy and infrastructure and direct and indirect pressure from US. There are some other development challenges faced by china, they are not listed yet likewise in Gwadar infrastructure

The status of china economy is very popular in Asia as well as whole world. China has the established economy like the US, according to the various researches china would overtake US to be most famous economy in the next some years. China main focus on technological innovation in Pakistan while developing CPEC so with the help of innovation Pakistan will adopt many innovation from china.

The energy projects as whole will addition 10440 megawatts to maintain the capacity. Estimated cost will be $ 15.5 billion for electricity generation. In second round, another megawatt about 6600 added in project to generate more electricity and it cost around $ 18.3 Billion. After completion of all energy projects energy generation will be boost up compared with previous electricity generation. This production boost economic growth has strong relationship and for better production as well as economy.

Infrastructure projects are very important for Pakistan and china off course to maintain trade and routes to kashgar to Gwadar and other Asian countries as well. Big infrastructural projects are proposed and are in advancement which will add around 3000 Kilometers to the current street combined with the railroad lines along the course. We will get the “National network” which incorporates the availability among nodal urban areas (Peshawar, Islamabad, Hyderabad, Karachi, Gwadar, Sakkar, Quetta, Lahore and Faisalabad), provincial urban Mergers and it’ll additionally make the new urban zones. While “Provincial Connectivity” is comprised on CAREC, Gulf States, Afghanistan and Iran. These undertakings will be finished with an assumed expense of US $ 10 billion.

CPEC gives a number of possibilities, the primary of which economic development. The large influx of investments will work as a strong monetary incentive for Pakistan’s government and social sectors to encourage business to enhance the foreign investment in Pakistan with the help of economic development, that allows you to now not only benefit Chinese traders engaged in CPEC, however will also gain all foreign investors in Pakistan, for example Russia and united states. Improvement in industry sector also create more employment for people. It also reduce the financial burden and social threats.

CPEC is association numerous locales and could add to the further integration of South Asia. The center rationale of CPEC is to development framework to encourage interconnectivity. Many countries and area get advantage from it. The venture is required to interface numerous nations China, Pakistan, Afghanistan Iran, and Central Asian nations together, incorporating a market of two billion individuals and balancing out the district. CPEC will enable South Asia to appreciate the full advantages of district wide exchange, extending from Iran to China.

China is one of the biggest economy and also has beaten US in many things even facing corona virus pandemic conditions but he will beat completely after some years so due to this there are many security threats to china projects like CPEC and Belt and Road Initiative (BRI). Security threat is for both countries, especially Pakistan have many threats due to terrorism, extremism, political parties, Tareek-e-Taliban, Baluchistan liberation Project (BLP) Laskhkar-e-Tayeeba, corruptions, Gwadar and other militants. All these parties and international forces are creating issue to stop this mega project CPEC. They basically don’t want to promote development in Pakistan. Hopefully China will overcome this issue with the help of Pakistan’s cooperation.

Continue Reading

Economy

Building Back Better: The new normal development path

Alek Karci Kurniawan

Published

on

Global stock markets such as Footsie, Dow Jones Industrial Average and Nikkei has decreased the profit since the outbreak of Covid-19 Pandemic in early 2020. Dow Jones fell to its lowest point, minus 35%, in April 2020 (Bloomberg, 4/27/2020). In US, more than 1 in 4 workers have lost their jobs since the coronavirus crisis shut down much of the economy in March.(National Public Radio, 28/3/2020).

Even the trend of Covid-19 death case has decrease, but still worried. Will the second wave happen? Because of that a new normal order is needed, when the spread of the pandemic stops and then the economy returns to normal.

There are at least two potential scenarios for the recovery of the economic crisis which were affected by Covid-19. The first scenario, gross domestic product will be pushed in such a way as to make the economy grow faster. By stimulating consumption, investment, government spending, and commodity exports.  At the same time, industrialization will grow stronger than the pre-Covid-19 conditions.

Environmental conditions that had improved during the emergence of Covid-19 might be polluted again. Carbon emissions are predicted to rise into the air, to pre-Covid-19 levels, and will even be higher than before. This is what is called the “revenge pollution” phenomenon. Like the recession and the global financial crisis in 2008, which is comparable to the scale of the crisis impact of the Pandemic Covid-19, even in very different kinds. Governments in the world responded with an economic rescue package and a stimulus worth by billions of USD. But in the last decade, greenhouse gas emissions have increased.

China has a real precedent. In response to the global financial crisis in 2008, the Chinese government launched a USD 586 billion stimulus package focused on massive infrastructure projects. That is why China’s industry has grown rapidly over the years. But for the environmental impact, their emission levels increased. Known as “airpocalypse” as the worst smog in city centers, such as Beijing in the winter of 2012 and 2013.

Besides, the world also creates a level of inequality that is far greater than that seen since the Second World War. The world shows a very striking difference between the super-rich and the very poor in terms of health, job security, education and other matters. As stated by Oxfam (2017), the wealth of 1% of the rich is equal to the combined wealth of 99% of the world’s population.

Then the second scenario, where we depart from the revenge pollution precedent after 2008. Pandemics give opportunities, when the economy back to begin normally and new rules, there is an opportunity to make the impossible to possible – or the last ignored things can be applied. This is the best time for the green agenda includes in the order that we want to renew.

Oxford University recently published an interesting study related to the global crisis recovery plan, entitled “Building back better: Green COVID-19 recovery packages will boost economic growth and stop climate change.” The focus of the research is to compare between green stimulus projects with traditional stimulus, such as the taken steps after the 2008 global financial crisis. The researchers found that, green projects create more work, provide higher short-term returns, and lead to long-term increased cost savings.

In economic development, to quickly recover from the crisis, the Government needs projects, which is called by experts with the term ‘shovel ready’ infrastructure projects. It exceeds labor-intensive projects, it also does not need high-level skills or extensive training, and gives profitable infrastructure for the economy. An example is the clean energy infrastructure, which produces twice as much work as a fossil fuel project.

We can see the need for bicycle-friendly and pedestrian-friendly infrastructure in cities. Then build a broadband internet network connection, because online systems for schools and work will be used massively. And the network for charging electric vehicles. Therefore, in the future we will definitely need more electricity. It also needs mass projects for solar, wind and biogas power plants.

According to WRI (2017), the main sources of global greenhouse gas emissions are electricity (31%), agriculture (11%), transportation (15%), forestry (6%) and manufacturing (12%). All types of energy production contribute 72% of all emissions. The energy sector is the most dominant factor causing greenhouse gas emissions. That’s how our lives are still dependent on fossil energy in the “old normal”. “New normal” should be able to replace old energy sources with renewable energy.

In April 2020, EU Ministers of environment launched “The European Green Deal” as the point of the post Covid-19 recovery process. At least 100 billion Euros were mobilized during the 2021-2027 period in the most affected regions for investment in environmentally friendly technology, decarbonate energy sector, and other new green norms.

CEOs of large companies such as Ikea, H&M and Danone have signed commitments representing the private sector in this alliance. The Contracting Parties understand that the fight against climate change is the point of Europe’s new economic policy, with an emphasis on renewable energy, zero emissions and new technology. This should be an example for the world in crisis recovery from the impact of the Corona virus pandemic. There is an opportunity to redesign a sustainable and inclusive economy.

In the Paris Agreement 2015, countries in the world have agreed to responsible for reducing the impact of climate change, with different portions and capabilities.The target is quite high, the world must reduce emissions by more than 45% if global warming is limited to 1.5 °C. Without the great new adaptation, the goals won’t be achieved easily.

Continue Reading

Publications

Latest

Trending