BRICS Grapple with China Dominance in South-South Trade

Brazil, Russia, India and South Africa struggle to compete against once-poor China, now the world’s second largest economy. India ranks 4th, Russia 7th, Brazil 9th and South Africa about 20th in world GDP. Growing South-South commerce, which represents 17 percent of the global total versus 7 percent in 1990, is imbalanced, reports Alan Wheatley, global economics correspondent for Reuters. So far, the group of five nations known as the BRICS have cooperated on trade, climate change and other policies, countering Europe and the US. But China’s fierce competition in shoe, textile and other industries could strain the cooperation, especially as emerging economies try to shift trade focus from commodities and agriculture to value-added products. If China grows too fast, the other emerging economies could resist, taking protectionist stances or opposing Chinese initiatives. To counter such threats, China may continue easing its currency restrictions and provide more foreign direct investment to balance trade benefits. – YaleGlobal