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“South-South Trade & Investment Cooperation: Exploring IBSA Initiative” |
| CUTS International, in association with the South African Institute of International Affairs (SAIIA), organised the ‘South-South Economic Cooperation: Exploring IBSA Initiative’ Project Launch Meeting on 15th February 2005 at Johannesburg, South Africa. Attended by representatives from the Indian and Brazilian missions, and a number of business, media and research organisations, the meeting laid a fertile ground for engaging non-state actors in the India, Brazil and South Africa (IBSA) initiative, a timely and much needed extension of ambitious cooperation process initiated by the three IBSA countries; India, Brazil and South Africa. Inaugural The inaugural session started with a warm welcome by Elizabeth Sidiropoulos, SAIIA and a short introduction of SAIIA’s activities, especially concerning the IBSA countries. Elizabeth briefly mentioned of a SAIIA research project on security dynamics within IBSA countries, jointly conducted by SAIIA, University of Brasilia and Jawaharlal Nehru University. Lyal White, also of SAIIA, launched the SAIIA IBSA Report, which studies the IBSA relationship from a geopolitical context. He broadly summarised the report by giving a historical perspective of the formalised IBSA relationship, perceived roles played by each country, objectives of the initiative, views from other Southern countries and finally some recommendations on furthering the IBSA cooperation. (Refer to SAIIA Report for details) Pranav Kumar, CUTS, briefly provided an overview of the currents trends in South-South cooperation and the IBSA initiative in the context of the WTO. He enumerated CUTS work on South-South Economic Cooperation, the first being in select Mekong countries (Lao, Cambodia and Vietnam) and the second in IBSA countries. He introduced the CUTS IBSA project, its objectives, research methodology and expected outcomes. (Refer to CUTS IBSA Project Brochure for details) Session 1 Cintia Quiliconi, Faculted Latino Americana De Ciencia’s Sociales (FLACSO), Argentina, chaired the first session “South-South Economic Cooperation and the IBSA Initiative”. “Though the IBSA initiative involved three countries, it also involved closer relationship between Mercosur, SACU and India,” she said. Though Brazil is the most supportive driver of closer cooperation with India within South America, all of the Mercosur countries have signed a trade agreement with India. Hence, one cannot look at such initiatives in isolation but in the context of their regional effects. Mario Marconini, Institute of International Trade Negotiations (ICONE), Brazil, the first speaker, provided a Brazilian perspective on the IBSA initiative. He said that Brazil has increasingly emphasised an export-driven, market-seeking approach in its trade policy. However, it lacks an efficiency-seeking approach. With 1 percent share in world’s FDI, and a 1 percent share in world imports and exports, Brazil needs to do a lot more to enforce trade priorities over its current geopolitical approach, dominated by power alliances and political aspirations. Mario also highlighted that the main parameters for a successful IBSA cooperation would require that the cooperation should focus on trade and investment; not conflict with economic cooperation with bigger partners; enhance cooperation in the WTO; be consistent with integration into the world economy; avoid red tape and add to productivity and competitiveness of all the three countries. Parashar Kulkarni, CUTS, India presented a comparison of economic and development characteristics of IBSA countries. Outlining the concerns, such as unemployment, HIV, and inequality, he emphasised on the scope for development-related complementarities within IBSA countries and opportunities for learning on public policy domains. On the economic front, he mentioned how competition in automobiles and leather is leading to complementarities within IBSA countries, such as sourcing of auto components and footwear machinery. He also outlined that economic complementarities may be less effectively utilised if key constraints, such as transport costs, language gaps, regional spaghetti bowls and non-tariff barriers are not tackled. Stephen Gelb established the relationship between South Africa’s IBSA initiative and its African initiatives such as The New Partnership for Africa’s Development (NEPAD). He said that unlike an often-reflected view that South Africa’s international and regional policies are conflicting, the IBSA Initiative would compliment African initiatives. Both Africa and IBSA have close political and cultural routes. Also, the diminishing energy within the NEPAD Initiative clearly reveals that Africa cannot bring itself to reform all alone. For strengthening the IBSA Initiative and ensuring complementarity with other initiatives, non-economic issues such as employment, health and education should be addressed within the IBSA Initiative. In South Africa, the government is having a difficult time creating jobs. The IBSA Initiative can help South Africa to learn and apply labour intensive job creation. Session 2 Kuseni Dlamini, AngloGold Ashanti, chaired the second session. He reiterated the corporate view on regional initiatives by saying that the IBSA Initiative cannot remain a political agenda, and businesses should form an integral part of the cooperation. Trade and investment relations can improve only if businesses are active drivers of such alliances. James Lennox, The South African Chamber of Business (SACOB), provided a glimpse of what businesses look for in these initiatives. He said that businesses are confused on the lack of coordination and transparency in trade agreements. Also, the government, while signing these agreements, seldom consults them. Will the IBSA initiative reduce costs for South African businesses? Will it reduce the hassles in trade within the three countries, and, importantly, will it provide newer markets for growing our business? These are the important questions that businesses ask regarding the IBSA initiative, James said. In conclusion, he restated that the success of the IBSA initiative would be based on how it will result in more profit for businesses. Shiela Sudhakaran, Federation of Indian Chambers of Commerce and Industry (FICCI), gave a presentation on the prospects of promoting tourism within IBSA countries. Tourism is an unexplored area for cooperation. There is a growing middle class within IBSA countries, which brings out huge prospects for tourism. Indians are the highest spenders as tourists. Brazil and South Africa can serve as good tourist destinations for Indian visitors, and vice versa. The high travel costs and non-availability of direct flights between India and Brazil needs to be addressed. However, South Africa is in a favourable position, since it is close to both Brazil and India, she said. Several important questions and comments were raised in the meeting. A representative of VN Holdings, a logistics company in South Africa emphasised on the need for improvement in logistics within IBSA countries. Another comment emphasised on the need to improve trade facilitation within IBSA. Concern was also expressed on how businesses are completely unconcerned of social aspirations of the government in such initiatives and that corporate social responsibility practices should be used to ensure that businesses are more proactive in IBSA-like initiatives. The meeting was concluded by a vote of thanks by Peter Draper, SAIIA. |
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2005 Consumer Unity & Trust Society (CUTS), All
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