Only the Chinese could turn an acronym into a trading bloc. On Wednesday, the BRICS summit will get underway in Johannesburg and top of the agenda for Brazil, Russia, India, China and South Africa will be rising worldwide trade tensions.
While this is a gathering of equals, the economic muscle of Beijing will be behind most of the crucial decisions, which will filter through from the three-day talkfest.
Major players such as China’s President Xi Jinping, India’s Prime Minister Narendra Modi and Russia’s President Vladimir Putin will probably take center stage. So, it appears, will United States President Donald Trump, who will be more than 13,000 kilometers, or 8,077 miles, away in Washington.
Indeed, the trade war between the White House and Beijing has cast a shadow over the BRICS, a term coined by Jim O’Neill, the former Goldman Sachs economist, back in 2001 when it was known as the BRIC grouping of emerging economies before South Africa joined.
Since then, it has morphed into a key political and economic organization fueled by China’s global ambitions.
“Today, BRICS is coping with a fragile global recovery that is overshadowed by the [United States’] new unilateral and protectionist policies,” Dan Steinbock, the founder of the Difference Group, an international business relations company focusing on investment and risk among advanced and emerging economies, said in an opinion piece for the state-owned China Daily.
Stepped up efforts
Earlier this month, Beijing stepped up efforts to realign its international policy by forging even closer links with other “developing nations,” such as the BRICS bloc, to counter “trade protectionism.”
The pace will continue to accelerate after Trump announced at the weekend he was ready to impose tariffs on all Chinese imports, worth US$500 billion, after mounting a personal crusade to bring the US deficit down with the world’s second-largest economy.
Last year, it was an eye-watering $375.2 billion and hit a record high for a single month of $28.97 billion in June.
Trump has also targeted the “Made in China 2025” program involving advanced technology and accused Beijing of manipulating the renminbi currency, an accusation China has denied.
“As to the US being bent on provoking a trade war, China does not want a trade war but is not afraid,” Geng Shuang, a spokesman for the Foreign Ministry, said at a media briefing on Monday. “Threats and intimidation will never work. [But] we advise the United States to remain calm and handle and solve related issues with a rational attitude.”
This latest move by Washington to highlight the drop in the renminbi as a means of boosting export growth has upped the ante in what can only be described as a high-stakes game of political and economic poker.
Already the International Monetary Fund has warned that the trade war will have a significant impact on growth across the world and this will be discussed in Johannesburg, according to Maxim Oreshkin, the Russian economy minister.
“The summit is about the context … we are at a time when the US and China announce new measures almost every week. This is a trade war, so leaders’ discussions are particularly important in coordinating our positions,” he said.
The specter of a currency conflict will only add to the urgency for a common policy. “If a currency war breaks out, it will definitely be destructive for all,” Song Guoyou, the director of Fudan University’s Center for Economic Diplomacy, told the Global Times, which is run by the People’s Daily, the official newspaper of China’s Communist Party.
To shore up its position, China has been broadening its economic base with BRICS partners such as Brazil and is now the South American nation’s s biggest trading partner.
Agricultural imports
Between 2003 to June this year, Chinese companies had invested almost $54 billion in roughly 100 projects, data from Brazil’s Ministry of Planning revealed. Last year, the figure was just short of $11 billion.
But while Beijing seeks to wean itself off agricultural imports from the West and, in particular, the US by increasing trade with the Brasilia government, Xi’s administration faces headwinds at home.
Apart from a cooling economy, there appear to be growing concerns about the all-consuming war on debt and the handling of the trade dispute with Washington.
To compound his domestic problems, Xi was out of the country when a scandal about “faulty vaccines” went viral on social media earlier this week.
“People are going to look back at this year as the pivot point when Xi Jinping overreached and sparked an international backlash against the [Communist] Party and China’s development model on multiple fronts,” Jude Blanchette, the China practice lead at the Crumpton Group, the strategic consulting firm based in the US, and a former researcher at the Conference Board in Beijing, told Bloomberg.
For now, Xi is in the company of “friends” and putting together a coalition of the willing to ease the pain of a long drawn out trade battle. How that will play out, could shape China’s economic future.
In 1973 India had a bigger economy than China. But today it has one 4 times that of India. Reason – Indian are still raping their secretaries and anyone else they can find.
Trump is trying to solve America’s problems. That’s his only focus. China’s side of the trade war only helps him. Trump’s goal is to wean America off the globalization teat and make it self sufficient. Increased tariffs will increase the cost of imports to America and open u opportunities to American entrepreneurs and businesses to fill the gaps. Trump’s strategy will innoculate America against China’s goal of squeezing America out of the world trade community.
Prem Sawlani, India is the king of the rapist nation of the world, every 15 minutes there is a rape in India, Indians rape toddler to elderly and female to male alike, Indians also lynched their victims after raping them. People wonder why Indians are so morally defunct, your ugly face and foul mouth do explain Indians beastly deeds.
Trump’s American self reliance project, i.e. American First project, needs few decades if not century to accomplish, it cannot be done in the current American political system and environment, perhaps the American should invite Chinese to carry out a political shock therapy treatment in the USA to help Trump achieve his American First project.
Americans have a mindset belonging to the past, stalled in the old days of colonialism and constrained by the zero-sum cold war mentality, this is not a fabrication, the author of this article proves this phenomenon.
Donald Trump cannot achieve Make America Great Again project, because as this author reflects in the article that the American based their goal on something bad happens to others, not by working hard themselves to achieve their goal, Such beggar-thy-neighbour mentality is quite unique in mankind.
I was told by my foreman Samy that girls were selling themselves in India for as little as a cotton handkerchief around that time.
Take some hint from Jamie Simon, CEO of JPM: Trump strategy won’t work. Not only so, it will fail America and the World as a result.
China and the World had better find alternatives NOW. It would be tough time ahead but this is the start of the American collapse predicted some time ago.
I would clarify to the American imperialists, contrary to the US, not every move of China is aimed at America. The World has a life, with or without America.
Richard Truong I disagree with your characterization os Americans as imperialists. Unlike China and Russia we have not acquired other countries property since the end of wwll. However, I agree with you about China’s goals. They are much broader than the US. They are trying to benefit Asian countries in exchange for resources, territory, political alignment and hegemony as they become the largest economy in the world. But that doesn’t nullify the fact that they eliminate doing business in US Dollars to force establishment of the Yuan as the world’s reserve currency and eliminate US [articipation in the BRI and its trade benefits.
Art Laramee Thanks for your posts. I agree with you that The Donald can start the process of making/allowing the US to become more self-sufficient (Yes, he can destroy the existing Liberal World Order). Richard Truang makes a good point that he is unlikely to complete the process in his 2-6 years left of being in office. For the transition to work, not only does he have to destroy the existing system, but he has to have a majority of Americans willing to back the strategy so it can continue after him. His major problem is that he never explains his strategy (some think he has none) such that people only understand a vague goal (America First) but not how to get there.
Sonny Azhak
I observed that you and your kind are incapable of an intelligent debate, therefore resorting to insult and racist slurs.
Quite pathetic!
Syed Abbas
Even after using the India’s special accounting method.
Syed Abbas what a brilliant reply. May you live longer than your ancestors.
Richard Truong exactly my thought
You are conflicting yourself in the same paragraph! You think Trump is "to wean America off the globalization teat and make it self sufficient", yet you also think China is "squeezing America out of the world trade community"! If China is really doing that, shouldn’t you thank China for helping Trump to "wean America off the globalization"? LOL. Make up your mind what you want. Trump and his team has no idea what they want and where their action will lead them either. Sadly, we will suffer the consequences in America long after these idiots are gone from the scene.
In 2017, trade deficit of USA with China was 375.2 billion dollars, that is, 31.26 billion dollars per month on average. In June 2018, the deficit was 28.97 billion dollars. How can it be a record?
China is not building a wall of bric. China is opening up to the World in all fields including trade, investments, etc. USA, on the other hand, is building a wall around itself – physically like the wall between itself and Mexico, in trade by imposing tariffs on products imported from China, EU, Canada, Mexico, etc.
Haav Bline You don’t read with comprehension. Trump’s strategy is created to protect America from China’s strategy. Trump knows exactly what he is doing just like he knows exactly what China is doing. Trump is also a man who seeks peace as does China. The knee jerk critics don’t get it.
Douglas Houck Trump is up against an entrenched political establshment, bureaucratic lethargy and inertia and frankly an unsophisticated media and American public. There are a ton of factors at work, but Trump is keeping his message simple to get through the message bungling media that is not just unsophisticated, they are parochial, lazy and addicted to gossipy gotcha news stories. Trump has taken a 2 x 4 to the foreheads of everyone because he needs to break through the existing thought processes mired in the paternal approach America took towards countries devastated by WWll and its idea to help the emerging economies especially China. One perfect example of this is we have foreign aid for nearly every country in existence. We can’t carry this load anymore thanks to Obama’s increase in our debt. We will be a lousy ally if we can’t assert ourselves internationally and we were headed there. Our allies need the same self examination. They are not worth much either if they can’t can’t defend themselves, then rather than allies they are burdens.
It is the whole world against the US. China did not create the problem. US could be the most powerful country on earth. Isolated, that power means nothing.
The US trade deficits with 120 countries cannot be uncoupled from the role of the US Dollar as world reserve currency. No matter what Trump does the US Dollar will create the US trade deficit. This is the " Triffin Effect." QE to finance military adventures, military imperialism, to reflate the economy, to bail out farmers, and manufacturers will ensure the US will continue its appetite for imports.
Incon Nu ‘At least they have sex with women’.
I think you need some update on the sexual attackes on women in india.
a)-A young girl with a hearing disability was drugged and gang-raped by at least 22 men repeatedly over a seven-month period at the apartment complex where her family lives in Chennai, India, her mother told police.
b)-An 11-year-old girl from the Indian city of Chennai was raped by 17 men who worked in the building she lived in, local authorities said on Tuesday.
c)-A 22-year-old married woman from Chandigarh has alleged that she was raped by 40 men for four consecutive days after being held captive at a guest house in Morni area of Haryana’s Panchkula district.
The problem with American or western think tanks and with American or western analysts is that they project the bad and evil actions of the western countries onto China. USA is building a wall around itself, so they think that China is doing the same when in fact China is doing just the opposite. While USA is isolating itself with physical walls and with tariffs, China is opening up to the World. BRICS is only one of the mechanism used by China to open up to the World. Other mechanisms include the Belt and Road initiative, the AIIB, the G20, APEC, cooperation mechanism with Africa, cooperation mechanism with Latin American countries, cooperation with ASEAN countries, etc.
Art Laramee After last week’s news conference, the whole world can see that Putin is the one who knows exactly what Trump is doing. Trump doesn’t.
Dalit you left India staying in my country,but your DNA still wreaks of harijan blood, if you ever rape women in taipei ill come looking for you ,remember you’re not in rapistan, now go make me a chai you dabbawalla
Richard Truong We are on different planets. We don’t communicate/
Arthur Micol
BRICS??? Hahahahahaha!