South Africa asks Putin not to go

TASS/MIKHAIL METZEL via REUTERS - El presidente ruso Vladimir Putin asiste a una reunión con el presidente sudafricano Cyril Ramaphosa tras la cumbre Rusia-África en San Petersburgo, Rusia, 29 de julio de 2023
photo_camera TASS/MIKHAIL METZEL via REUTERS - Russian President Vladimir Putin attends a meeting with South African President Cyril Ramaphosa after the Russia-Africa summit in St. Petersburg, Russia, July 29, 2023

Luiz Inácio Lula da Silva was already president of Brazil in November 2008 when the idea of organising the first summit of BRIC heads of state was born: Brazil, Russia, India and China. At the time, the Russian president was Dmitry Medvedev and Vladimir Putin was serving as prime minister, after leaving the presidency in Medvedev's hands.

The meeting was consolidated in June 2009 in Yekaterinburg, Russia, and from that moment on, the member countries have held a rotating presidency and annual meetings; in 2010, they added South Africa, becoming the BRICS at the express invitation of the then Chinese president, Hu Jintao, who saw enormous potential for expansion in the African economy.

Fifteen years after their first summit, the new meeting in Johannesburg (22-24 August) has a different nuance: Putin has been under arrest warrant issued by the International Criminal Court since last March, accusing the Russian dictator of alleged war crimes related to the deportation and illegal transfer of children from Ukraine to Russia.

South African President Cyril Ramaphosa, as host of the summit, would be obliged to comply with the arrest warrant as the African country is one of the 123 member states of the ICC. The United States, Russia, China, India, India, Israel, Pakistan, Turkey and North Korea are not.

Ramaphosa has repeatedly asked Putin not to attend the BRICS summit in person, which for the Russian dictator is an affront because he will have to stay in Moscow while his country's delegation is represented by his foreign minister, Sergey Lavrov.

Putin will have to make do with speaking by videoconference, although he has taken an active part in the agenda items that will be discussed by all the leaders and their respective delegations.

In particular, the Russian leader is interested in accelerating the process of de-dollarisation of the BRICS economies; in fact, since the first summit, Russia has been emphasising the need to create a diverse international monetary system and for the economies to cut their dependence on the dollar as the global reserve currency.

China has been aggressively joining this initiative to such an extent that Putin is talking about conducting trade, investment and economic relations through yuan.

He is also supported by Lula da Silva. A couple of months ago, the Brazilian president put on the table to his South American counterparts and Mercosur partners the need for their own currency, something like a South American euro. A currency that would leave the dollar aside.

In the United States, the five BRICS countries account for almost 50% of the world economy and both China and India have a growth potential that analysts have long considered to be the axis of economic leadership in the 21st century, as they also account for 45% of the world's population.

The fact is that China wants to add new participants and Russia is seconding it by putting the immediate inclusion of Iran on the agenda. Although the vision of the Chinese leader, Xi Jinping, is more ambitious because he wants to include Algeria, Saudi Arabia, the United Arab Emirates, Iran, Egypt, Argentina, Mexico and Nigeria in the BRICS; and he does not rule out Bangladesh, the Philippines, Indonesia, Pakistan, Turkey and Vietnam either.


There is also the increasingly active role of the Shanghai-based New Development Bank (NDB), which was created with the contribution of the BRICS central banks.

The NDB has clear objectives: to escape the hegemony of the dollar by promoting the use of national currencies, to stimulate domestic demand in the countries, trade and investment, and to try to avoid financial speculation in currencies. Credits would be used to build infrastructure and reduce the risk of inflation.

Ahead of the summit in South Africa, the NBD issued its first bond in rand, the local currency, displacing any possibility of using the dollar and also becoming the highest-rated issuer to issue in the South African market since 2015.

"The bond is backed by more than two and a half billion rand (about $130 million) in offerings in the three and five-year tranches," the local press announced.

The development finance agency aims to become a major issuer in the local capital markets of each of its member countries and is seeking to expand its portfolio of member countries. It intends to finance part of its loan portfolio in the local currency of each member country; in recent years it has added Uruguay, the United Arab Emirates, Egypt and Bangladesh.