Sameera Casmod | sameerac@radioislam.co.za
23 August 2023 | 11:31am SAST
2-min read

Picture: Radio Islam International

In an interview aired on Radio Islam International, Kamal Ramburuth from the Institute for Economic Justice discussed the BRICS Summit in the context of being an essential platform for the participating nations to reshape international economic governance, prioritise sustainable development, and advocate for socio-economic rights. As the five BRICS nations and observer countries gather for this summit, Ramburuth, the IEJ’s Global Economic Governance programme researcher, highlights the potential opportunities and challenges that lie ahead.

The interview underscores the significance of the BRICS Summit as a forum for multilateral cooperation and peaceful conflict resolution. Ramburuth acknowledges that several global problems require immediate attention, including the war in Ukraine and its economic impact, as well as human rights issues faced by many participating countries. The interview emphasises the opportunity for BRICS to expand human rights and socio-economic rights through cooperation.

The conversation also focused on the potential for the BRICS countries to play a pivotal role in reshaping the global financial architecture. With the debt crisis exacerbated by the aftermath of COVID-19, the BRICS bloc can tackle issues like interest rate hikes, debt sustainability, and the need to fund ecological transitions, according to Ramburuth. He also applauds the success of the New Development Bank as a significant achievement within this framework, highlighting its effective disbursement of funds to member nations.

“In the first five years of its existence, the New Development Bank, between 2016 and 2020, dispersed about $20 billion to Brazil, India, China and South Africa. And if you compare that to the World Bank that has a far larger capital and has been around for more than 80 years… dispersed 30 billion,” Ramburuth noted.

The interview touches upon the challenge of private investment schemes that often prioritise private sector profits, leaving the public sector at a disadvantage. Ramburuth expresses concern over the de-risking of private investments, which shifts risks and costs onto governments. This model, while being adopted worldwide, poses a concern for the Institute for Economic Justice (IEJ) regarding its potential implications for socio-economic development and debt sustainability.

“[There] is a new model of finance that is being adopted worldwide… But this financing isn’t just a simple loan. Often it’s trying to escort in private capital to make investments. The appeal… is that you’ll scale from de-risking billions to creating trillions of investment opportunities… and where the de-risking approach has worked, it’s put huge pressures on governments [and] that has negative effects on debt sustainability,” explained Ramburuth.

Ramburuth offers insights into expectations for the 2023 BRICS Summit from an economic perspective. Trade encouragement, knowledge exchanges, and increased people-to-people exchanges are anticipated as the summit’s political outcomes. The interview anticipates greater impetus behind the New Development Bank, expansion of the trade routes, and the bloc’s potential expansion itself. Ramburuth also underscores the potential for the BRICS summit to influence international tax cooperation and reforms in the global financial architecture.

The interview concludes by emphasising the potential positive impact of BRICS cooperation on the lives of ordinary citizens. The transformation of the productive economy through localisation, industrial policies, and beneficiation is highlighted as the key to translating economic cooperation into better job opportunities, higher wages, and enhanced well-being for people across member countries.

Listen to the full interview on Sabaahul Muslim with Moulana Junaid Kharsany here.