BRICS fantasies and unintended revelations

GOA, INDIA - A Brazilian leader’s faux pas spoke volumes about the Brazil-Russia-India-China-South Africa (BRICS) heads of state summit in Goa, at a well-protected beach resort this weekend. In Brasilia last month, foreign minister (and occasional presidential candidate) José Serra told an interviewer that the BRICS included Argentina. And as he stumbled while spelling out the acronym, Serra also had to be prompted to recall that South Africa is a member (because in English it is the “S” in BRICS, but in Portuguese the country is “Africa do Sul”).

Well-known journalist Luis Nassif disgustedly concluded that the politician – who has a doctorate in economics from Cornell University and was implicated in various corruption scandals, including favours western oil companies against Brazil’s own Petrobras – is “neurologically damaged.”

With men like Serra and his president Michel Temer (also corrupt and widely despised) at the helm, so too is the BRICS bloc damaged goods. Former Goldman Sachs investment strategist Jim O’Neill recently offered faint praise, that “some of the BRICS are kind of doing basically what I thought they would do” though he conceded that Brazil, Russia and South Africa suffer the “commodities curse.”

BRICS as a project is now being written off, unfairly I think (given its sub-imperial accomplishments), because of divergent economic interests and zany geopolitical circumstances.

The latter inconsistencies start with anti-Washington regimes in Beijing (with sabre rattling over a few rocks in the South China Sea) and Moscow (whose sabres are sticking out of victims in eastern Ukraine and Syria, not to mention allegations of Russian-hacked emails repeatedly wounding Hillary Clinton). These defensive gestures are justified given the prolific record of malevolent destruction meted out by Washington, especially since the Bush-Obama regime began in 2001.

Yet not only does BRICS also contain Temer’s right-wing coup ‘government’ in Brasilia with its strong pro-imperial bias, but also the far-right Hindi nationalist government in New Delhi. As Brazilian commentator Pepe Escobar recently explained to Russia Today, “The cozying up to the Pentagon happens just a few months after Prime Minister Narendra Modi – who had been denied a US visa for nearly a decade – addressed a joint meeting of Congress in a blaze of glory, declaring that India and the US are natural allies.”

Meanwhile in between, Pretoria politicians, as usual, are talking left while walking right. Indeed after the dust of ideological confusion settles, at least one consistency is observable from all the BRICS elites: a stream of anti-imperialist chatter even when the intent is to assimilate into imperialism.

Last week, for example, African National Congress general secretary Gwede Mantashe pronounced, “South Africa will continue to call for the transformation of the Bretton Woods Institutions and oligopolistic credit ratings industry.”

He is worried because in December, it is widely anticipated that Standard&Poors, Fitch and Moody’s will deliver Pretoria a junk-bond rating and with it a run on the currency. Indeed the run just restarted following this week’s surreal accusations by the national prosecutor that finance minister Pravin Gordhan committed fraud by helping a friend secure a $75 000 early pension – a gambit seen as a crude excuse for the crony capitalist faction of the ANC to insist Jacob Zuma fire Gordhan, who is mainly backed by neoliberals and big business but also by democrats worried about the slide into a corrupt dictatorship.

Calling for ‘transformation’ of the erratic New York rating agencies is absolutely valid, yet the real problem is what lies behind them: international financiers who now have Pretoria under the thumb of foreign debt.

That debt load recently hit a historic record of 44% of GDP, and to repay interest while permitting massive corporate profit outflows, will mean yet more borrowing from Western – or BRICS – lenders. South Africa’s energy parastatal Eskom is in the process of negotiating a $5 billion loan from China, for example, so it can argue the case for self-financing a nuclear programme, likely to be acquired from Russia or China. Will a new BRICS credit rating agency be a solution, or will it be just an excuse to put future generations of South Africans deeper into a debt that must be repaid, not with rands (which can be printed) but with hard currency ($ or yuan)?

Hatred of the World Bank and International Monetary Fund (IMF) is also easy to articulate from Brazil. As BRICS New Development Bank (NDB) vice president Paulo Nogueira Batista remarked last week, “The Washington institutions fundamentally reflect the point of view, the interest, the ideology of the North Atlantic powers, the Europeans on one hand the Americans on the other.”

But here the BRICS are at their most self-delusional and self-destructive, for they have had the chance to change the Bretton Woods Institutions in two ways: contesting their leadership and changing their voting power. The past months are revealing on both counts.

First, no doubt that both World Bank President Jim Kim and IMF Managing Director Christine Lagarde need to be replaced. They won’t be, though, because the BRICS failed to put up a fight. In 2011 Lagarde was contested by a Mexican and in 2012 Kim fought a Colombian and Nigerian – but with divergent BRICS’ country backing, so neither stood a chance.

In 2016, both were allowed to retain their posts, even though former French Finance Minister Lagarde is subject to an upcoming corruption trial based on her €400 million largesse to a generous party donor, Adidas founder Bernard Tapie; and even though Kim is described by University of Pennsylvania political scientist Devesh Kapur as

“among the worst presidents in World Bank history. His administration has been marked by authoritarianism and capriciousness, and he has forced out senior managers at unprecedented rates, sometimes requiring the Bank to reach quiet settlements with those affected. In four years, the president’s office has had five chiefs-of-staff, and several of the Bank’s senior women have left, hinting at a capricious leadership culture.”

His critics on the left (from where Kim entered politics) are just as forthright, especially when it comes to his support for damaging mega-hydro projects and disastrous roll-back of social and environmental standards.

If ever there was a case for the BRICS making a stand against the imperialist multilateral banking tradition – that a European leads the IMF and a US citizen leads the World Bank – this was the year. But as Kapur remarked, the “World Bank’s recipe for irrelevance” was partly cooked up within the BRICS kitchen because “in the World Bank Group’s official leadership, the first three people listed after the president – hailing from Brazil, China, and India, respectively – are carefully distributed by nationality.”

The same kind of sub-imperialist assimilation was on display when the IMF included the Chinese yuan in its basket of currencies last November and a month later when voting power was rearranged, giving China an increase of 37%, Brazil 23%, India 11%, and Russia 8% – but at the expense of Nigeria (which lost 41%), Libya (39%), Morocco (27%), Gabon (26%), Algeria (26%), Namibia (26%) and even South Africa (21%).

On top of that, last month the World Bank and NDB officials signed a deal for

“co-financing of projects; facilitation of knowledge exchange… advisory services; and facilitating secondments and staff exchanges... We greatly appreciate timely support offered by the World Bank Group throughout our establishment process, and look forward to advancing and deepening our co-operation.”

So, will the Bretton Woods Institutions save the BRICS NDB and Contingent Reserve Arrangement from irrelevance – especially since the latter BRICS agency explicitly relies upon the IMF for policing structural adjustment loans?

Tough questions about the bloc’s coherence are being asked; e.g. in South Africa, Megan van Wyngaardt of Creamer Media recently enquired, “With each BRICS country facing challenges, could it disband?” Institute for Global Dialogue researcher Francis Kornegay replied, “BRICS is increasingly taking the form of RICs” due to the Brazilian and South African crises.

In contrast, a group of several hundred activists from India have gathered for two days prior to the summit in a more optimistic mode. The ‘People’s Forum on BRICS’ aims “to connect local voices and concerns of Goa to the global scenario and critically engage with BRICS in this endeavour… to share analysis, struggle notes and build solidarity in the struggle for a more just and equitable society.”

Especially in the wake of a massive national strike day last month by more than 150 million Indian workers opposed to Modi’s neoliberalism, such a society appears nowhere on the BRICS’ leaders radar screen, aside from rhetoric.

BRICS leaders are protected from this rabble by Modi’s proto-fascistic police state. And to top off the Taj Exotica 7-star resort’s aesthetics, sand sculptures have been constructed for the leaders’ delight: the Taj Mahal, the Great Wall of China, Russia’s Saint Basil Cathedral, Rio de Janeiro’s Christ the Redeemer statue and, representing South Africa, it is the Afrikaans Language monument near Stellenbosch.

What?! All these memorial structures have dubious origins in patriarchy and the religious oppression of the poor. But it was 40 years ago this year that the final leg of the anti-apartheid struggle kicked off in Soweto, as students poured into the street (much as they are this week against the apartheid-economics of high university tuition fees). Their immediate grievance was being forced to learn Afrikaans.

The language monument contains a telling inscription by Nicolaas Petrus van Wyk Louw – “Afrikaans stands with one leg in Africa and with the other in the west” –  that somehow also speaks to the BRICS’ real agenda, sub-imperialism: five countries’ feet joining those of the US and EU, firmly astride the throats of the world’s poorest people.

* Patrick Bond is Professor of Political Economy at Wits University School of Governance, Johannesburg.

* THE VIEWS OF THE ABOVE ARTICLE ARE THOSE OF THE AUTHOR AND DO NOT NECESSARILY REFLECT THE VIEWS OF THE PAMBAZUKA NEWS EDITORIAL TEAM

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