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14 June 2022 | Story Dr Nitha Ramnath | Photo Francois van Vuuren (iflair photography)
Prof Anil Sooklal, Ambassador-at-Large for Asia and BRICS
Prof Anil Sooklal, Ambassador-at-Large for Asia and BRICS in the Department of International Relations and Cooperation, Republic of South Africa

“The Global South is no longer weak. Nor will we continue to perpetuate suffering imposed upon us. BRICS has an important role to play in shaping the emerging international order at this critical juncture in human history.” These were the sentiments of Prof Anil Sooklal, Ambassador-at-Large for Asia and BRICS, Department of International Relations and Cooperation, Republic of South Africa, who presented a guest lecture titled: The Role of BRICS in Shaping the Emerging International Order. The lecture, hosted by the University of the Free State (UFS), was followed by a panel discussion facilitated by Prof Francis Petersen, the Rector and Vice-Chancellor of the UFS, with panel members comprising Prof Philippe Burger, Dean of the Faculty of Economic and Management Sciences, UFS; Prof Hussein Solomon, Senior Professor, Political Studies and Governance, UFS; and Ms Mosibudi Motimele, Lecturer, Political Studies and Governance, UFS. 

While the outbreak of the Russia-Ukraine war has prompted questions about the future of BRICS, Ambassador Sooklal’s position is clear – there is a future for BRICS. “It is paramount that the Global South is no longer an outlier or merely a witness to an evolving global architecture,” says Ambassador Sooklal. He emphasised that “BRICS is a powerful voice of countries of the South. The BRICS Outreach and BRICS Plus have been embraced by the countries of the South, which have been interacting with BRICS over the past decade, including the AU and other regional organisations of the South”.  

BRICS was founded on the core principle of shaping an international order that is fair, just, inclusive, equitable, and representative. It is also focused on strengthening and reforming multilateral systems, with the UN at its centre. “It is important that BRICS remains true to its founding principles and continues, now more than ever, to champion the core interests of the Global South, especially overcoming political, economic, and financial marginalisation. Furthermore, BRICS must continue to address the key developmental challenges of poverty, underdevelopment, and inequality, which have been relegated to the margins by most in the international community. BRICS must become a force multiplier in addressing the key challenges of the developing world,” added Ambassador Sooklal. 

The ambassador cautioned South Africa against being drawn into a major power contestation and encouraged that those who seek to perpetuate their hegemonic ambitions on the global stage be challenged. 

“BRICS must continue to champion the interests of the South while also working in partnership and co-operation with the global community, including countries of the North that share a common vision of creating a global order that is underpinned by multi-polarity, a rule-based international order, international law, and a reinvigorated, reformed, and strengthened multilateral system with the UN at its centre,” said Ambassador Sooklal. 

He added that we must return to the ideals of the UN Charter and build a people-centred world order, as so succinctly stated in the preamble of the charter. 

Prof Burger reflected on the nature of BRICS and expressed that the nature of BRICS is not all that clear because of the political developments in BRICS and the US over the past eight years. “In spite of all the business and academic interaction, BRICS today is ideologically weaker than a decade ago, as its members are less united in purpose,” said Prof Burger. 

Prof Burger added that politics in four of the five BRICS countries turned nationalist. “For two of the four, this means a new Cold War with the US. 

For the other two, however, this means closer ties with the US.” 

Where does this leave South Africa, the fifth country? According to Prof Burger, we should not burn our bridges. “We need Chinese and US investments, and we should also learn the nature of the regimes in all four of the other BRICS countries.” 
Prof Anil Sooklal with Prof Francis PetersenProf Anil Sooklal with Prof Francis Petersen, UFS Rector and Vice-Chancellor. Photo: Francois van Vuuren.

“As a country that really needs to get its economy growing, we will certainly need to tread very carefully,” said Prof Burger. 

Prof Solomon was not convinced that BRICS had a role to play in shaping the international order, taking a rather pessimistic view of the BRICS grouping, which he felt made no sense, sharing no common values nor strategic interests. 

“China’s economic relationship with Africa, as with many of its other so-called partners, is one of neo-colonialism,” said Prof Solomon. He added that China and Russia have anti-West rhetoric and a narrative of decolonisation in common, while expanding their own national interests across the continent. 

“More worrying is the militarisation of China’s presence in Africa – this does not represent a new emancipatory order, but an old order based on national interests and power. Moreover, it constitutes a clear and present danger to South Africa’s own national interests,” added Prof Solomon. 

Click to view documentAmbassador Sooklal’s paper can here.

News Archive

Inaugural lecture: Prof. Phillipe Burger
2007-11-26

 

Attending the lecture were, from the left: Prof. Tienie Crous (Dean of the Faculty of Economic and Management Sciences at the UFS), Prof. Phillipe Burger (Departmental Chairperson of the Department of Economics at the UFS), and Prof. Frederick Fourie (Rector and Vice-Chancellor of the UFS).
Photo: Stephen Collet

 
A summary of an inaugural lecture presented by Prof. Phillipe Burger on the topic: “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

South African business cycle shows reduction in volatility

Better monetary policy and improvements in the financial sector that place less liquidity constraints on individuals is one of the main reasons for the reduction in the volatility of the South African economy. The improvement in access to the financial sector also enables individuals to manage their debt better.

These are some of the findings in an analysis on the volatility of the South African business cycle done by Prof. Philippe Burger, Departmental Chairperson of the University of the Free State’s (UFS) Department of Economics.

Prof. Burger delivered his inaugural lecture last night (22 November 2007) on the Main Campus in Bloemfontein on the topic “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

In his lecture, Prof. Burger emphasised a few key aspects of the South African business cycle and indicated how it changed during the periods 1960-1976, 1976-1994 en 1994-2006.

With the Gross Domestic Product (GDP) as an indicator of the business cycle, the analysis identified the variables that showed the highest correlation with the GDP. During the periods 1976-1994 and 1994-2006, these included durable consumption, manufacturing investment, private sector investment, as well as investment in machinery and non-residential buildings. Other variables that also show a high correlation with the GDP are imports, non-durable consumption, investment in the financial services sector, investment by general government, as well as investment in residential buildings.

Prof. Burger’s analysis also shows that changes in durable consumption, investment in the manufacturing sector, investment in the private sector, as well as investment in non-residential buildings preceded changes in the GDP. If changes in a variable such as durable consumption precede changes in the GDP, it is an indication that durable consumption is one of the drivers of the business cycle. The up or down swing of durable consumption may, in other words, just as well contribute to an up or down swing in the business cycle.

A surprising finding of the analysis is the particularly strong role durable consumption has played in the business cycle since 1994. This finding is especially surprising due to the fact that durable consumption only constitutes about 12% of the total household consumption.

A further surprising finding is the particularly small role exports have been playing since 1960 as a driver of the business cycle. In South Africa it is still generally accepted that exports are one of the most important drivers of the business cycle. It is generally accepted that, should the business cycles of South Africa’s most important trade partners show an upward phase; these partners will purchase more from South Africa. This increase in exports will contribute to the South African economy moving upward. Prof. Burger’s analyses shows, however, that exports have generally never fulfil this role.

Over and above the identification of the drivers of the South African business cycle, Prof. Burger’s analysis also investigated the volatility of the business cycle.

When the periods 1976-1994 and 1994-2006 are compared, the analysis shows that the volatility of the business cycle has reduced since 1994 with more than half. The reduction in volatility can be traced to the reduction in the volatility of household consumption (especially durables and services), as well as a reduction in the volatility of investment in machinery, non-residential buildings and transport equipment. The last three coincide with the general reduction in the volatility of investment in the manufacturing sector. Investment in sectors such as electricity and transport (not to be confused with investment in transport equipment by various sectors) which are strongly dominated by the government, did not contribute to the decrease in volatility.

In his analysis, Prof. Burger supplies reasons for the reduction in volatility. One of the explanations is the reduction in the shocks affecting the economy – especially in the South African context. Another explanation is the application of an improved monetary policy by the South African Reserve Bank since the mid 1990’s. A third explanation is the better access to liquidity and credit since the mid 1990’s, which enables the better management of household finance and the absorption of financial shocks.

A further reason which contributed to the reduction in volatility in countries such as the United States of America’s business cycle is better inventory management. While the volatility of inventory in South Africa has also reduced there is, according to Prof. Burger, little proof that better inventory management contributed to the reduction in volatility of the GDP.

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