South Africa's role as the voice of Africa's interests at the fifth Brics (Brazil, Russia, India, China and South Africa) summit will be tested by how well it can gain tangible benefits for itself and manage the rising expectations over the benefits it can leverage for the continent through its place at the Brics table, according to policy analysts.
The position South Africa has adopted as the champion of the continent, is a largely self-imposed one, and is contested by other African nations, said Memory Dube, senior researcher at the South Africa Institute for International Affairs.
To succeed it required a comprehensive and articulate Brics strategy that puts South Africa's interests first, and an African development agenda that considers the competition of Brics nations on the continent, she said.
Dube was speaking at a media briefing hosted by the institute ahead of the fifth Brics summit in Durban being held on Tuesday and Wednesday.
Following the summit, President Jacob Zuma will host the Brics Leaders Africa Dialogue Forum Retreat, which will examine issues important to Africa's development including infrastructure development and regional integration and industrialisation.
Trade between the Brics and the rest of the continent increased to an estimated $340-billion in 2012, a tenfold increase over the last decade, according to figures from Standard Bank.
But the grouping engages more on a bilateral level between individual African and Brics countries, instead of as an economic bloc, said Dube. She doubted whether the current Brics agenda would work to supersede those bilateral relationships.
Growing competition
The continent is a site of growing competition for both natural resources and trade among the Brics countries.
As much as Africans have celebrated the Brics as an alternative to traditional trade partners from the developed West, the trade patterns between Africa and the Brics mirror those between Africa and advanced industrialised economies, she said, with African countries being a source of raw materials for Brics nations and an export market for Brics manufactured goods.
The Southern African Development Community (SADC) is also key to the success of South Africa's strategy.
"South Africa's tradability to deliver will depend on its ability to broker real integration and development within the SADC region," said Dube.
The region faces significant deficits when it comes to things such as infrastructure, similar to many other areas in Africa.
On Monday, Zuma said in a statement ahead of the summit that the importance of the Brics was reflected at bilateral level.
Strategic partnership
South Africa's trade with these countries stood at R294-billion, in 2012, a growth of 11% from 2011.
Zuma said a number of agreements would be signed to cement economic ties between South Africa and other Brics countries, including the declaration of a strategic partnership between South Africa and Russia.
He said the summit also sought to obtain increased support for the reform of international financial institutions, such as the World Bank, the revival of the Doha development agenda at the World Trade Organisation, as well as the reform of the United Nations including the United Nations Security Council.
The Brics are, however, still exploring whether they will be able to reach agreement on many issues, according to Catherine Grant-Makokera head of South African Institute of International Affairs's economic diplomacy programme.
Another challenge for leaders at this summit would be achieving a measure of geo-political convergence on security issues, in regions like the Middle East, notably Syria, but also in African states such as Mali and the Central African Republic, where 13 South African soldiers died in battles with rebels this weekend.
Testing relations
Discussions over the nomination of a Brics candidate to replace the current director general of the World Trade Organisation, Pascal Lami, were also likely, said Grant.
This would again test South Africa's position as a link between Africa and the Brics said Grant, as it remained to be seen whether it would support Brazil's Roberto Carvalho de Azevêdo or the African Union's preferred candidate, Ghana's Alan John Kwadwo Kyerematen.
There were likely to be concrete results from the work on deepening financial ties between the Brics nations however, such as the efforts that began to pool currency reserves and the initial exploration of establishing a Brics led-development bank, said Grant.
The biggest challenge, however, was how well South Africa managed expectations of African countries at the Brics-Africa leaders dialogue, with what Brics nations were actually willing to discuss, she said.
Growing currency
Meanwhile, China's currency, the renminbi, is only going to grow in importance as China's proportion of world trade continues to grow, according to Sim Tshabalala, chief executive of Standard Bank.
He was speaking at a debate hosted by the bank, ahead of the summit.
A way to end the reliance on third party currencies, namely the US dollar, which retains its position as a global reserve currency, was something the Brics nations were seeking to do as they broadened their trade with each other and with other African countries.
While the US dollar is still by far the largest peg to trade on the African continent, Standard Bank estimates that by 2015 Sino-African trade will hit $300-billion, with around 40% of Sino-African trade renminbi-based by the same year. As trade grows between these countries, particularly China and the African continent, a way to get around the reliance on third party currencies would help to ameliorate foreign exchange risks .
Central banks in countries such as Nigeria have already moved to diversify their holdings of foreign currency to include renminbi. While, according to Grant, Brazil has made it clear that they too are interested in accessing renminbi as part of their foreign exchange reserves.
Formalising economic relations
The fluctuation of the exchange rate between the rand and the US dollar was "a headache" for Huawei Enterprises, its president for Eastern and Southern Africa, Eman Liu said. The China-based information and communications technology firm, however, conducts all its China-Africa trade in US dollars he said.
Analysts and observers said moves by the Brics nations to cement these kinds of financial ties could help to formalise economic relations among the body, which until now has acted more as a diplomatic grouping.
Among the issues up for discussion between these major emerging economies will be possible establishment of a Brics-led development bank; the pooling of members' foreign exchange reserves; as well as further work on creating a trade and development insurance risk pool, with a view to establishing an alternative re-insurance network for the Brics nations.
But although the Brics began as an "intellectual construct" it has allowed economic and political actors to reframe and redirect their strategies to incorporate the Brics, according to Siobahn Cleary, director of strategy and public policy at the Johannesburg Stock Exchange.
Along with clarity on the development of the Brics bank, Tshabalala said he hoped that ways to address barriers between Brics nations, and their trade with the continent, would be put forward at the summit.