BRICS dreams fade as trade spats, tensions cloud meeting

Shanghai

TRADE ministers of the BRICS nations - Brazil, Russia, India, China and South Africa - will meet in Shanghai next week under the shadow of rising trade spats and border tensions between the group's Asian members. The meeting precedes the annual leaders' summit in September and will discuss trade liberalisation, commitment to a multilateral system and other issues, according to a Chinese Ministry of Commerce briefing this week. But prospects for the group to develop into a united powerhouse of emerging economies look as distant as any time since economist Jim O'Neill coined the term back in 2001.

The split among emerging market economies may create strains between winners and laggards, according to Louis Kuijs, head of Asia economics at Oxford Economics in Hong Kong. "This tension is likely to get worse rather than better in the coming decade and will reduce the ability of the BRICS group to speak with one voice." The BRICS have found little common ground in recent years as their growth trajectories diverged and geopolitical ambitions spurred tensions. China has kept up its rapid, albeit moderated, growth pace, and India has vied with it for bragging rights as the world's fastest growing major economy. But life has been tougher for the commodity dependent economies of Russia, South Africa, and Brazil, with the latter also plagued by political turmoil.