Pretoria still expecting BRICS to deliver vaccine research centre in South Africa

The South African government is still expecting BRICS to establish a BRICS Vaccine Research Centre in South Africa though nothing was publicly said about it at last week’s summit in Brasilia.

This was one concrete takeaway which President Ramaphosa urged at the 11th BRICS summit, hosted by Brazil. With some evident impatience, Ramaphosa said in his address to the summit last Thursday:

“We must continue collectively to work together to implement the important initiatives that we have agreed at past summits and during this one, including the creation of the physical BRICS Vaccine Research Centre in South Africa that we agreed to last year in Johannesburg.”

But there was nothing about a decision to go ahead with the vaccine research centre in the Brasilia Declaration which reported on the outcomes of last week’s summit. And in fact, the Johannesburg Declaration from the 10th BRICS summit in South Africa in 2018 had referred only to a “proposal” to establish a BRICS vaccine research and development centre and had not specified where it would be.

Pretoria is nonetheless adamant that BRICS had decided to establish the centre and that it would be in South Africa.

“The BRICS Vaccine Research Centre (BVRC) as agreed to at the Johannesburg Summit is a work in progress,” Lunga Ngqengelele, spokesperson for International Relations and Co-operation Minister Naledi Pandor told Daily Maverick.

“The Working Group dealing with it is due to meet in Brazil on 28 November to discuss the modalities and other related issues. Note that though the summit is over, Brazil holds the BRICS presidency until 31 December 2019 and experts’ meetings are still ongoing.

“Setting up the centre requires much preparation which the working group is seized with. So this decision is on track and we are busy with establishing the BVRC as per 2018 summit decision. Our president mentioned it in the context of the said decision and a reminder that we [should] make speedy progress in its implementation.”

The research centre is expected to focus on finding a vaccine for tuberculosis and the Brasilia Declaration did welcome the Collaborative Research Programme for TB, developed by BRICS TB Research Network in 2019, aimed at promoting new scientific, technological and innovative approaches to tackle the TB burden, by supporting scientific projects in a wide range of relevant issues related to TB.

“We emphasise the importance of our collective action in promoting research and development of medicines and diagnostic tools to end epidemics, to combat communicable diseases and to facilitate access to safe, effective, quality and affordable essential medicines, as well as activities to strengthen non-communicable diseases prevention.”

In his response to the summit, Ramaphosa stressed the economic benefits of BRICS. He noted that the five countries in the group represented about 42% of the global population, 23% of global GDP, 30% of the planet’s territory and 18% of global trade.

The benefits of BRICS membership were evident in the presence in South Africa of Brazilian bus manufacturers, Russian train manufacturers, Indian automotive companies and Chinese machinery producers.

“Each of the BRICS countries has South African fruit and vegetables on their tables, buildings constructed from South African metals and factories fitted with South African machinery and electronics,” he said.

He attributed these benefits to the BRICS strategy for economic partnership and the work of the BRICS Business Council. Ramaphosa said the council promoted economic growth, especially through intra-BRICS trade, and was able to identify nodes of economic growth.

It had already identified a number of projects in infrastructure development, agriculture, renewable energy, agro-processing, mining and a range of other projects that would positively influence the economies of BRICS countries.
The council would ensure that the BRICS New Development Bank or other financial institutions financed these projects.

Ramaphosa cited the bank as another notable positive outcome of BRICS membership, as demonstrated by its strong capital base and its projects already underway in all member states, with South Africa so far having been allocated $2.5-billion in loans.

In his report to the summit, NDB President KV Kamath said the Shanghai-based bank had so far approved 46 projects for $12.8-billion in the five member countries.

“By the end of this year, we expect the approvals to reach about $15-billion. In 2020, we are targeting approvals of $8-billion to $10-billion,” he said.

“We are measuring the impact of our work through our contributions to the achievement of the Sustainable Development Goals that our members have committed to. We are also supporting projects that address some of the core developmental needs in our member countries, as articulated in their development agendas.”

In South Africa, the NDB was assisting energy and water projects, “two areas that are at the heart of the country’s economic and social challenges”. He said the bank had so far received $5.6-billion in capital from its five members, including advance payments of the fifth instalment by China and Russia.

“We expect to receive the balance $900-million of the fifth instalment from our other three members by January 2020,” he said. Kamath said the bank’s first regional centre — the Africa Regional Centre in Johannesburg — had proved that “on-the-ground presence makes a big difference to our work”. The second regional centre, in Brazil, was already staffed and ready to open, while the Moscow office would open early in 2020 and the Delhi office during the first half of 2020.

Kamath said the bank was capable of lending between US$8-billion to $10-billion annually, with the initial $10-billion of capital that has been provided to it by the five founding members, achieving a total asset book of about $50-billion by 2027. With the addition of new members which was being considered, the bank could grow further, to achieve a total asset book of about $90-billion by 2027.

At a meeting among the five leaders of the BRICS countries with the NDB and the BRICS Business Council on the sidelines of the summit, Ramaphosa said the five BRICS nations, as founding members of the bank, had made a commitment that the bank should benefit not only BRICS countries, but should extend its horizon to other emerging markets and developing countries.

South Africa was particularly impressed with the bank’s efforts to ensure that it became a global financial institution by 2021 and supported its flexible approach to membership and the composition of the list of countries it was considering as prospective members for the first phase of expansion.

“We stand ready to support the bank in this process, particularly with regard to reaching out to Africa,” Ramaphosa said.

“We are confident that the NDB’s activities on the continent will assist in addressing the large infrastructure financing gap that has been impeding economic growth and development in Africa. In this slowing growth environment, where fiscal and monetary policy is limited, public and private role players need to collaborate to support growth.”

But he cautioned that as the NDB grew, it should not lose sight of its developmental mandate:

“We call on the NDB to ensure that its financing policies support infrastructure development in all our countries.”

Though Ramaphosa welcomed the benefits of the BRICS economic partnership strategy, adopted at the seventh summit in 2015, he also said much still needed to be done to implement and benefit from the strategy.

“In particular, there is tremendous scope to expand the value of trade and investment between BRICS countries, and to address the trade imbalance between our economies,” he said in his address to the Brasilia summit.

“As a country that is primarily an exporter of commodities to its BRICS partners, South Africa supports a shift towards complementary and value-added trade,” Ramaphosa added.

In his address to the summit, Ramaphosa also told his fellow BRICS leaders that over the past year, his government had made steady progress in improving the ease of doing business in South Africa by improving the country’s competitiveness.

“Even under great fiscal pressure, South Africa’s macroeconomic environment has proven resilient. South Africa is emerging from a period of difficulty as it confronts challenges that are immense, but not insurmountable,” he said.

He said the other BRICS countries would also reap the benefits of the African Continental Free Trade Area which is to come into effect in May 2020, creating a single market from Africa’s 54 nations, with a total population of about 1.2 billion people and a combined GDP of more than $3-trillion.

Ramaphosa also welcomed the adoption by the BRICS trade ministers of the terms of reference that would guide the establishment of the BRICS Technical Advisory Group on the Partnership for the New Industrial Revolution — known as PartNIR — which was agreed on at last year’s summit in Johannesburg.

“PartNIR aims to further strengthen the work of the BRICS Economic Partnership Strategy to accelerate economic growth, job creation and the broader socio-economic benefits.”

One of the focus areas identified for PartNIR is to support the growth of small, medium and micro enterprises and co-operatives — especially those owned by women, youth and other disadvantaged groups — and to enable them to access markets within BRICS and beyond. DM