On April 14th, in Sanya, province of Hainan, China, the Asian giant will host a meeting of the BRIC (Brazil, Russia, India, and China), that will incorporate South Africa to the bloc of emerging powers. From now on, we will talk about the BRICS: A group of countries that will make a qualitative leap in the near future to become members of an economic and political power bloc through which they will assume greater responsibilities in a new world order. In the next decade, this grouping will represent the current North American Gross Domestic Product (GDP).
Today the BRIC accounts for 40% of the world population, 25% of the total extension of the Earth, 25% of the GDP, and 12.8% of the international trade. China stands out as the third economic power of the world. The BRICS is forced to expand to maintain its growth rate and this definitely places these countries in the grand chessboard as key pieces (in an unstable grand chessboard), in which they will use their growth to compete with the traditional economic powers (the Triad: United States, European Union, and Japan). This will secure them the resources´ supply they lack to sustain and increase their economies, and it will turn them into global powers interacting in a multipolar framework.
These new realities of the world are reflected in our American continent (in the Latin American space) showing more presence, influence and relations that change the traditional relations South America and the Caribbean had with the North American power, particularly after the Second World War.
The figures of the BRIC countries´ relations with South America and the Caribbean show the importance they give to our region, which is led in South America by Brazil, a member of this group. The Undersecretary General for Asia of the Brazilian Ministry of Foreign Affairs, María Edileuza Reis explains: “Chinawill play a very important role in the administration of President Dilma Rousseff. We will aim at a qualitative leap in our relationship.” The figures of China, Russia and India´s relationship with Latin America speak for themselves: According to the Economic Commission for Latin America and the Caribbean (ECLAC), the trade with China grew at rates of 30% a year in the last decade and it will grow 15% until 2020. “Brazil has a lot to gain from its relationship with China; the trade surplus gained is huge: More than US$5 billion based on a trade of US$56 billion. But there are many concerns in Brazil as the relationship is becoming more asymmetrical.” That’s why this high-level Chinese-Brazilian gathering is so important.
The bilateral trade agreement of China with Latin America rocketed from US$10 billion in 2000 to US$143.4 billion in 2008. During the first nine months of 2010, there was an increase of 68%, according to the ECLAC. China relies on Brazil, Chile, Mexico, Argentina, and Venezuela as its main trade partners.Brazil and Chile together account for 60% of the exports to China. Now Peru joins to this new trade relationship (that outperforms the trade agreement to China over the traditional agreement to United States).
Besides, other BRIC members are developing solid investments in our continent:
Russiahas revealed a strong presence with the signing of arms export deals with several countries of the area, plus technical and trade agreements for technology transference, production licenses, and financial credits that have been ratified by the presence, for the first time in history, of a Russian President together with an important political and economic committee. In his visit to Argentina on April 2010, Dimitri Medvedev declared: “Latin Americais not the backyard of any country.”
Indiainvested almost $10 billion in Latin America in 2009. The trade relationship between both has increased in $18 billion during the last decade, and some Latin American companies already have cooperation agreements with Indian colleagues. This relationship is spreading to greater added-value sectors, such as the technology sector. Indian companies are looking for opportunities in Latin America to invest in lands, through purchase or tenancy, in order to secure the supply of agricultural raw materials. The giant of the Asian subcontinent is increasingly in need of lands suitable for agriculture, aiming at providing food to a population of around 1.1 billion people.
This leads us to conclude that the times of United States unipolarity are declining, and that after the tsunami that destroyed the neoliberal ideas, Latin America should take advantage of these times of multipolarity and the changes of the economic paradigms.The natural wealth of our countries should be used to build our new self-focused industrial and continental area, and not only a primary product export area as it is the current situation. The Economist Salvador Treber from the National University of Córdoba, Argentina, states that in the next years, Argentina and the region should “nail down good accomplishments, and the national economies should benefit from this unique opportunity to diversify production and complete the vertical integration of the fields considered necessary, with the main aim of supporting the future expansion” (1). Today Brazil, Chile and Argentina represent 77% of the total region exports to China and these are generally commodities with low level of technology and production chain.
This year the Southern Common Market (Mercado Común del Sur, MERCOSUR), foundation of this regional deployment, is celebrating its 20th anniversary. Its major accomplishment is the creation of a mega bloc geopolitical awareness of integrationist action that, despite the existing differences and difficulties, provides a basis for substantial decision making to work as a political, historic and cultural bloc facing the world.
This allows us to strongly negotiate with blocs, such as the European Union and, thanks to the incorporation of Venezuela, Bolivia, and Chile, to reinforce and balance the current asymmetries. We are discovering the huge potentiality we have in the energy sector, our capacity of producing food and our wide range of great natural resources. Today America has a natural power that attracts the entire world. As ever its resources are object of greed but, in many ways, they are more critical than never. The hydrocarbons and the freshwater reserves are key assets for which a common strategy will be necessary to adopt in an increasingly industrialized and thirsty world (2). “Today Latin America is the most exciting region of the world”, and that’s why it has become the place where the BRICS challenges United States.
(1) Argentina Facing the Future World: http://licpereyramele.blogspot.com/2011/04/argentina-frente-al-mundo-del-futuro.html
(2) On The Way Towards Latin American Integration: http://www.lavoz.com.ar/opinion/camino-integracion-latinoamericana