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You are here:Home>>Archive>>South Africa admission into BRIC: Jim O’Neill and Oppositions should see the light
Saturday, 01 January 2011 03:07

South Africa admission into BRIC: Jim O’Neill and Oppositions should see the light Featured

Written by Emeka Chiakwelu
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South Africa is qualify to be in BRIC

Summary: Jim O’Neill, Chairman Goldman Sachs Asset Management, misread the tea leaf that South Africa will not be accepted into BRIC because of her relatively small population of 50 million and $287.2 billion GDP. But population is not everything as it has been proven with the entrance of South Africa into BRIC. South Africa a gateway to Africa is the largest and most developed economy in Africa. With relatively less corruption and with strong democratic standing coupled with durable civil and social infrastructures makes SA attractive to BRIC.

Jim O’Neill of Goldman Sachs, who coined the term BRIC, was not reacting favorably on the formal invitation of South Africa to join BRIC.  The invitation was extended to South Africa by China a member of the BRIC. These nations named BRIC comprises of Brazil, Russia, India and China. The BRIC are the largest and most powerful emerging economies.

Even before South Africa was invited to join BRIC, Jim O’Neill read the tea leaf incorrectly and made the prediction that South Africa was not the right candidate for BRIC membership. He further predicted that Nigeria will make it to BRIC before South Africa. Both of his predictions never materialized and the grip he thought he has on BRIC was waning.  Now he is sounding like he knows what is more important to the BRIC than the member nations.

Jim O’Neill did not wait for the ink of the invitation card for South Africa to dry before he commenced to give every reason why South Africa is not the justifiable candidate to make it to BRIC.  He made the claimed that South Africa was invited for political reason and not economics.  His words: "When I created the acronym, I had not expected that a political club of the leaders of the Bric countries would be formed as a result. In that regard, the purposes of the two might be regarded differently."  This statement makes him to sound like a mercantile economist of 18th century.  Jim O’Neill needs to take a class in political economy and to review Adam Smith’s Wealth of a Nation.  He should come into 21st century and understand the prevailing and the emerging state capitalism. Politics has never been divorced from economics in 21st century capitalism.

For his final analyst note of 2010, Jim O'Neill has placed his not inconsiderable stash of intellectual chips on the USA.

Jim O’Neill, Chairman Goldman Sachs Asset Management Photo:Telegraphy

Jim O’Neill commented on the GDP of South Africa which is about $287 billion and said, that South African economy is “quite small by not only BRIC standards, but compared to some others. For example, Russia is around $1,600 billion, nearly 5 times larger than South Africa. And, India is currently similar in size to Russia. Brazil is currently closer to $2,000 billion in size, while China is considerably larger at around $5,500 billion.”  His omission is that South Africa has a great potential and it is a gate way to Africa.  Looking at the GDP of South Africa will not tell you the whole story about the country.  The country is natural resources-rich and Africa has a vast arable soil for cultivation and agriculture. Moreover, South Africa’s debt-to-GDP ratio 29.50 % is among the lowest in the country’s category compared to Greece with debt-to-GDP ratio of 125 %.

All those raising voices on South Africa invitation into BRIC do not know more about South Africa than China that made the invitation. The China knows about her interest and where it lies and she is willing to protect her interest. Before China sends out invitation card to South Africa she has done her home work and has contacted rest of the BRIC members. What Jim O’Neill and his opposition camp should have done is to ask the BRIC members why they think that South Africa is the most suitable for membership.

On the population size of South Africa that prompted an initial reason for Jim O’Neill for not rooting for the relatively smaller South African population of 50 million. South Africa can easily increase her population by opening door to willing African neighboring countries to migrate into her country.

Mr. Emeka Chiakwelu is the Principal Policy Strategist at Afripol. Africa Political & Economic Strategic Center (AFRIPOL) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa.

 

Last modified on Tuesday, 03 April 2012 21:55

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