CAPE TOWN, South Africa — This week, 5,000 delegates from developing nations have gathered in the coastal city of Durban for the fifth annual BRICS summit, and the first to be held in South Africa, which joined the association of emerging national economies in 2010, formally becoming the "S" in the BRIC wall. But the location of this year's summit underscores a question often asked: Why exactly is South Africa a BRICS member?
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After all, listing Brazil, Russia, India, China, and South Africa sounds like that game on Sesame Street: "One of these things is not like the others." Unlike China, South Africa is not an economic powerhouse. It has neither the profit potential nor the productivity of India or Brazil. Russia's economy (the smallest of the BRIC nations) is four times larger than South Africa's, which accounts for just 2.5 percent of the bloc's gross domestic product (GDP). And with a population of 50 million, South Africa lacks the sizeable citizenry of those other countries.
In relation to its much-larger partners, South Africa exists, with apologies to David Frum, as the axis of asymmetry. Goldman Sachs economist Jim O'Neill, who coined the BRIC acronym in 2001, was himself surprised by South Africa's inclusion. What began as a economist's snappy acronym was actualized as an organization after the foreign ministers of the BRIC countries began a series of meetings in New York City in September 2006. This was followed by a diplomatic summit in the Russian city of Yekaterinburg, in May 2008, where the foundation for the organization was established. Shortly after it was announced that his club had gained a member, O'Neill wrote to his clients that "While this is clearly good news for South Africa, it is not entirely obvious to me why the BRIC countries should have agreed" to invite it.
Surely a more robust and exciting economy -- Turkey, Mexico, or South Korea -- would be a better fit?
No doubt. But Turkey, Mexico, and South Korea are not in Africa. South Africa is Africa's largest economy, and Africa is key for BRIC resources, trade, and economic expansion. According to economists at South Africa's Standard Bank, the BRIC nations trade more with South Africa than with each other. Thus it was not particularly surprising, then, that shortly after his 2009 inauguration, South African President Jacob Zuma made partnership with BRIC countries a priority, visiting each state and lobbying for closer ties.
South Africa's selection the following year thus made strategic sense, even as it baffled more literal-minded economists. The country's inclusion in the consortium had everything to do with politics, and very little to do with economic equivalency, developmental dynamics, or societal similarities. The invitation was about "location, location, location" -- and a favor from some very powerful friends. In return for which the BRIC states get political capital, increased trading ties, and a steadfast African ally.
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