The BRICS bloc — Brazil, Russia, India, China and South Africa — is concerned about the trade war which the Trump administration has sparked, and say it is working on mitigating its impact.
Trade and industry minister Rob Davies told the media at the 10th BRICS summit that the bloc is strengthening its trade partnerships to fight the effects of the trade war between the United States and China.
Davies lambasted the US for imposing 25% tariffs on steel and 10% on aluminium imports on South Africa earlier this year.
“The objective of this is to address perceived or actual imbalances in the global trading environment to the disadvantage of the largest or strongest economy in the world and not to re-balance of the interest of the majority of the interest of development,” he said at a media briefing.
Davies said leaders agreed a trade war marks a move towards unilateralism and discriminatory raising of tariffs above World Trade Organisation bindings.
Trade ministers of the BRICS countries said the current multilateral rules should not be undermined or weakened as this will expose smaller economies to the full might of global power relations, which is not to their advantage.
“Many of us have been affected by the measures that have been taken,” said Davies, referring to how the tariffs on steel and aluminium have breached South Africa’s benefits from the African Growth and Opportunity Act.
Although South Africa is not a real party to the trade war, it has been treated as collateral damage.
The BRICS nations have resolved to focus on the promotion of industrialisation and to grow value chains in preparation for the disruption of the fourth industrial revolution.
Davies added that he and his counterparts are aware that there is a competitive element within BRICS countries, as one country’s trade benefits may be at the detriment of the another, but they were working towards striking a balance in trade.
He also drew attention to the trade surplus between South Africa and the African continent, saying that this trend remains large although it has somewhat narrowed.
“South Africa is a big global player and Africa receives at least a quarter of its exports from South Africa [56% are value-added products] and we send finished goods into the African continent,” said Davies.