What role will the BRICS Contingency Reserve Arrangement (CRA) play compared to existing institutions such as the IMF? Will the BRICS develop lending paradigms that differ from those created by the Fund? Some say that the BRICS will avoid the conditionalities the IMF attaches to its loans. This could lead Western observers to accuse the BRICS of providing "rogue loans" and undermine the West's attempts to promote good governance and financial stability.
Conditionality – i.e., giving financial assistance contingent on the implementation of specific economic and political policies – is one of the key elements of the IMF’s Articles of Agreement, which points out that the recommended policies should avoid “measures destructive of national or international prosperity”. Conditionalities assure that resources are made temporarily available “under adequate safeguards”. Due to threat of moral hazard, loan repayments would be at risk without conditions. Therefore, according to the IMF, such rules are crucial to secure the revolving character of the Fund’s resources, because they increase the likelihood of repayment.
The BRICS, several of whom have been recent recipients of IMF loans, have long criticized the application of conditionalities for a series of reasons, several of which have been articulated elsewhere as well. Not only do they undermine democracy and self-determination, but they are also a tool for the strong to dominate the weak, considering that politically weak countries often receive more stringent adjustment obligations. For example, there is plenty of evidence that European countries or countries close to the US obtain loans with far fewer strings attached. In the same way, loans provided to countries currently in the UN Security Council are usually less stringent. In addition, the BRICS allege that the IMF often prescribes the wrong dosage of austerity due to a lack of expertise and knowledge of the affected economies.
Supporters of conditionalities argue that it would be wrong to wholly depict policy conditionalities as a forced treatment for an unwilling patient. Recipient governments may in fact prefer some degree of conditionality in order to increase their domestic bargaining power against factions that oppose reform. The IMF-imposed sanctions are thus welcomed, and the institution is used as a ‘scapegoat’ in the domestic debate to push through necessary measures. In such a scenario, a recipient country could possibly prefer a conditionality-laden IMF loan over a BRICS Bank loan free of any policy prescriptions.
While this may be true in some instances, the argument that the IMF imposes conditionalities to maintain its own financial health is flawed. In a fascinating paper, (IMF conditionality: theory and evidence, Public Choice (2009) 141: 233–267) Dreher shows that the assumption that conditionality increases the likelihood of repayment has very little supporting evidence. Governments, he writes, almost always repay loans eventually, irrespective of whether they implement the recommended policies or not. More worryingly, accepting an IMF loan and its policy prescriptions fails to put a country on the ‘right track’: The probability of future IMF programs is thus not decreasing, but increasing with current IMF programs.
The World Bank agrees with the critique of conditionality and has reformed its structural adjustment lending. Instead of lending under the Structural Adjustment Facility, the World Bank now supports countries’ own programs—without detailed conditions. In a similar way, IMF has eliminated much of the conditionality from its programs, providing conditionality-free loans that are disbursed in single payments under the new ‘Flexible Credit Line’.
Since the BRICS Contingency Reserve Arrangement (CRA) is, for now, only meant to function amongst the BRICS (and not, like the IMF, for a large number of countries), direct comparisons between the two are of course difficult. Yet regarding the guiding principles of the CRA, the findings mean that it could impose far fewer conditionalities without increasing the chance of recipient governments defaulting on loans. From the perspective of BRICS governments, providing conditionality-free loans also seems like an attractive option as it align with the norms and rules that have guided the BRICS countries’ individual strategies. Among them is the focus on mutual benefits without the attachments of policy conditionalities in governance, economic policy or institutional reform.
Read also:
South-South cooperation: Towards a new paradigm?
BRICS Development Bank: Patience required
The politics of the BRICS Contingency Reserve Arrangement (CRA)
How long can the United States hold back IMF reform?
In 2010, the International Monetary Fund seemed to finally adapt to new economic realities when the IMF Board of Governors approved IMF quota reforms that provided emerging powers with a greater say. The IMF hailed these steps as "historic" and pointed out that they represented "a major realignment in the ranking of quota shares that better reflects global economic realities, and a strengthening in the Fund's legitimacy and effectiveness."
Specifically, the reforms double the IMF’s quota to $720 billion, it shifts six percentage points of total quota to developing countries. China will become the third largest quota-holder at the Fund (second only to the US and Japan), and Brazil, Russia, and India all become top-ten quota-holders as well. Under the reform, U.S. voting power will decrease slightly but it would still maintain its veto. In addition, in reforming the Fund's Articles of Agreement, the change moves two of the 24 IMF directorships from European to developing countries.
Yet the 2010 reforms are subject to approval by national governments, including a deeply partisan U.S. Congress. The IMF previously had intended to make the 2010 reform package effective by October 2012, but the legislatures of the United States have not ratified the 14th General Review of Quotas package. Prior to the US elections, the Obama administration had decided to put off asking Congress to approve the reform to avoid unnecessary controversy. As soon as U.S. Congress approves it, it will come into effect, yet it seems far from clear when approval will occur. Particularly Republicans are sceptical whether to support the move, which would include extra US sources to the Fund.
While emerging powers have remained patient over the past year, discontent is beginning to spread among those who would stand to benefit most from the changes. The situation is particularly bizarre because a further round of IMF quota reforms is already under discussion and due for completion in January 2014.
In March 2013, almost 100 policy makers and academics sent a letter to US Congress urging the ratification of the reforms, arguing that any further delay would crucially reduce the United States' credibility in the Fund. It would also reduce confidence that the United States continues to be willing and able to assume leadership in global financial management. What good is a forward-looking President if he cannot convince US Congress of the necessities of reform? Finally, further delay could challenge the narrative that while the United States is willing to adapt global governance structures to new realities, it is mainly Europe that fears the rise of the BRICS.
If the United States truly wants to strengthen global governance, they will have to exercise leadership at home and convince US Congress that engaging emerging powers is the only way of assuring that international institutions remain functional once the traditional powers are no longer in control. The difficult process of adapting to a new reality has just begun. In the coming years and decades, far more extensive IMF reforms will have to be implemented if the institution is to maintain its legitimacy in the twenty-first century.
Read also:
Book review: “Theories of International Politics and Zombies” by Daniel W. Drezner
The politics of the BRICS Contingency Reserve Arrangement (CRA)
BRICS Development Bank: Patience required
http://ri.fgv.br/noticias/2013-05-14/vagas-de-estagio-em-sao-paulo
O Centro de Relações Internacionais da FGV, sediado na Escola de Ciências Sociais/CPDOC, oferece duas vagas de estágio em São Paulo. As vagas são, preferencialmente, para alunos de graduação dos cursos de Ciências Sociais, História, Relações Internacionais, Economia ou Direito Internacional, que tenham fluência em inglês e se interessem por questões de política e história internacional.
Sobre o CPDOC
O Centro de Pesquisa e Documentação de História Contemporânea do Brasil (CPDOC) é a Escola de Ciências Sociais da Fundação Getulio Vargas. Criado em 1973, tem o objetivo de abrigar conjuntos documentais relevantes para a história recente do país, desenvolver pesquisas em sua área de atuação e promover cursos de graduação e pós-graduação.
Desde 2009, o CPDOC abre espaço ao desenvolvimento das atividades rotineiras do Centro também na capital paulista. Tendo à frente o Professor Oliver Stuenkel, a coordenação leva a expertise dos pesquisadores do CPDOC a São Paulo, promovendo pesquisas e atividades acadêmicas, tais como aulas, palestras e debates públicos.
Efetiva-se por meio do CPDOC a presença e a atuação em São Paulo do Centro de Relações Internacionais da FGV. Sediado no CPDOC, o Centro de Relações Internacionais visa estimular o debate público sobre as principais questões internacionais contemporâneas.
O Centro de Relações Internacionais organiza regularmente debates abertos e gratuitos e também se envolve com projetos de pesquisa. Oferece também aos alunos de graduação de todas as escolas da FGV em São Paulo a Formação Complementar em Relações Internacionais.
O CPDOC oferece em São Paulo a Pós-Graduação em Cinema Documentário e os MBAs em Relações Internacionais e em Bens Culturais: Cultura, Economia e Gestão.
As vagas
São oferecidas duas vagas de estágio direcionadas às seguintes funções:
• Apoio à coordenação do CPDOC em São Paulo;
• Envolvimento com os diversos projetos conduzidos pelo CPDOC, sobretudo na área das Relações Internacionais, em suas diversas etapas (pesquisa, organização e sistematização de dados, participação em entrevistas e processamento dos conteúdos gerados);
• Organização de eventos acadêmicos, principalmente na área de Relações Internacionais;
• Eventual realização de filmagens e de processamento de material audiovisual;
Competências desejadas
• Pensar de forma crítica;
• Disciplina, organização, bom gerenciamento de tempo;
• Criatividade;
• Responsabilidade na execução de tarefas e projetos;
• Ótima comunicação: condução das ideias de maneira clara, concisa, tanto verbalmente quanto por escrito;
• Familiaridade com as mídias sociais e as ferramentas virtuais;
Qualificações desejadas
• Graduação em andamento em Ciências Sociais, História, Relações Internacionais, Economia, Direito Internacional e cursos afins.
• Formatura a partir de Junho de 2014;
• Fluência no inglês falado e escrito.
A seleção
• A seleção terá duas etapas: análise de CV e de carta de motivação; e entrevista + prova escrita em português e inglês.
Outras informações
• Local de trabalho: São Paulo, Av. Paulista.
• Remuneração: bolsa-auxílio compatível com mercado + VT + VR
• 30 horas semanais
• Início no dia 1 de junho de 2013
Os interessados devem enviar carta de motivação de até 1 página e currículo (CV) para cpdoc.sp@fgv.br até o dia 21/05, terça-feira.
While discussions around the 5th BRICS Summit in Durban were dominated by the creation of the BRICS Development Bank, another important decision was overlooked by many: The leaders of the BRICS decided to create a U$ 100 billion Contingency Reserve Arrangement (CRA) to tackle any possible financial crisis in the emerging economies. Contrary to the Development Bank, the contingency fund requires far fewer political negotiations, and it can be expected to start operating quite soon. The countries need a year to pass the relevant legislation, but policy makers believe that they will be able to reach a final agreement when BRICS gather in Fortaleza (Brazil) next year.
The set-up of a reserve pool is easier because it needs to physical structure to function. Each country’s central bank will keep the fund’s reserves as part of its own reserves. Only in moments of crisis in one of the member countries' economies will the contingency fund begin to operate, acting as a a cushion or back-up. Considering the increasing frequency and magnitude of global financial crises over the past decades, the addition of another fund that major countries can rapidly mobilize in times of crisis is bound to provide investor confidence.
China is expected to contribute a share of 41 billion US-dollars, followed by Brazil, Russia and India with 18 billion US-dollars each, and South Africa with 5 billion. Worries about an unequal distribution of power within the arrangement are unnecessary because unlike in the proposed BRICS Development Bank, where voting rights are established on the basis of the financial contribution of each country, the vote of China, Brazil, India or Russia will be enough to authorize the disbursement of funds, making South Africa the only actor that does not exert full control over the fund.
For several observers, the creation of a $100 billion contingency relief arrangement is a bid to sow the seeds of an alternate financial structure for developing countries, arguing that it could present a direct challenge to the IMF. After the 5th Summit, the Indian media hailed the created of the CRA as "a major win for India's campaign to reform global financial architecture."
Yet such an interpretation is largely unfounded - for now. This is mainly so because $100bn fund is relatively small by global standards. The BRICS countries control almost $5tn in international reserves, and if they were to contribute 16% of their reserves to a contingency fund the resulting CRA would total $800bn against $780bn in resources at the IMF. Of course, a CRA of 100 bn could be the stepping stone of something far larger, which could then truly undermine today's global financial order.
At the same time, arrangements similar to the BRICS CRA already exist and have not undermined the IMF. The BRICS' CRA is closely modeled on the Chiang Mai Initiative signed in May 2000 between the Association of Southeastern Asian Nations (ASEAN) countries as well as China, Japan and South Korea. The aim of the initiative is to strengthen the region's capacity to protect itself against risks in the global economy. It is intended to provide a supply of emergency liquidity to member countries facing currency crises—and avoid the need to depend on the IMF, which is seen, until today, as having abused its power in its emergency loans during the Asian financial crisis of 1997–98. The crisis is often referred to in the region as “the IMF crisis.” After establishing a headquarters in Singapore in 2009, the CMI was renamed the Chiang Mai Initiative Multilateralization (CMIM).
However, ultimate proof that the CMIM is not a threat to the IMF is the rule that a country under the CMIM umbrella could only access a small proportion of its line of emergency credit without being forced to enter into negotiations with the IMF for a standby agreement. Only 30% of a member’s quota is accessible without an IMF program. For the remaining 70% the member state must agree to an IMF program, including the much-loathed policy prescriptions.
In this sense the Chiang Mai Initiative Multilateralization is far from a counterweight to current IMF-led order. Unless the BRICS' CRA explicitly eliminates such an arrangement with the IMF, it too will be nested within the current system.
Funds have never been disbursed under the CMIM framework - when South Korea needed emergency liquidity in late 2008, it went directly to the U.S. central bank, so avoiding the humiliation of yet again having to deal with the IMF. In the same way, Indonesia preferred not to deal with CMIM (i.e. IMF) and requested help from Japan.
The BRICS' CRA is in many ways more courageous than the CMIM because it creates a global network, making it potentially far more powerful: A regional crisis in Brazil, for example, could be easily dealt with by the other BRICS, which may not be affected at all, thus reducing the risk that the crisis could globalize.
The key question, as with most other attempts to institutionalize South-South cooperation, is in how far the BRICS can establish clear norms and rules - for example, about whether CRA disbursements will be tied to policy conditionalities. If so, what will they look like? According to which paradigms will they be developed, if not following an IMF-inspired logic? Can the BRICS establish criteria according to which disbursements will be provided without replicating the much-hated IMF?
Read also:
BRICS Development Bank: Patience required
South-South cooperation: Towards a new paradigm?
During the 4th BRICS Summit in New Delhi in 2012, leaders agreed to study the possibility of a joint development bank. In the following 12 months, a group of policy makers hailing from each country's Ministry of Finance and Foreign Ministry convened regularly and wrote a viability report, which was presented a year later, during the 5th BRICS Summit in Durban. There, the BRICS decided to move ahead and begin the process of setting up the institution aimed at "mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries". However, it would have been difficult to be less specific about the Bank: "The initial contribution to the bank should be substantial and sufficient for the bank to be effective in financing infrastructure" the eThekwini Declaration reads.
This development is highly significant, for it is the first step towards institutionalizing the BRICS outfit, fundamentally altering its characteristics of a non-binding, informal consultation group. While most details about the Bank still need to be resolved, it is clear that operating such an institution will require the BRICS to agree on a set of guiding rules and norms. It will provide a unique opportunity to develop new development paradigms and, perhaps, start a real conversation between established lenders and rising powers about the future of development. The BRICS Bank could also be an important motor for change within established institutions such as the World Bank.
Over the past years, Nicholas Stern, Joseph Stiglitz, Amar Bhattacharya, and Mattia Romani have campaigned globally for such a bank - and it is largely based on their proposals that the Indian government chose to promote the issue within the BRICS framework in 2011.
As the four economists point out in a recent op-ed,
A new development bank is clearly needed. The infrastructure requirements in emerging-market economies and low-income countries are huge — 1.4-billion people still have no reliable electricity, 900-million lack access to clean water and 2.6-billion do not have adequate sanitation. About 2-billion people will move to cities in the next 25 years. Policy makers must ensure the investments are environmentally sustainable. To meet these and the other challenges, infrastructure spending will have to rise from about $800bn to at least $2-trillion a year in the coming decades or it will be impossible to achieve long-term poverty reduction and inclusive growth.
Since the summit in Durban in March 2013, the BRICS have set up an implementation committee to begin hammering out the details. The complexities are enormous, and substantive details are unlikely to emerge before 2014, when the 6th BRICS Summit will take place in Fortaleza in Brazil. In process, South Africa could turn into the greatest liability. With its economy increasingly affected by the global crisis, there are doubts about how much South Africa is willing and able to contribute to the Bank. Since Brazil and India, in particular, insist that each country should contribute the same amount (to avoid that the BRICS Bank will turn into a China-dominated institution), South Africa's economic weakness creates a formidable dilemma. Either the Bank is democratic and small, or large and controlled by China. Neither prospect seems particularly appealing. This is particularly worrisome because the proposed start-up capital of $50 billion for the Brics bank is far too small to have a systemic impact. During private conversations, Indian diplomats grumbled that ten times the amount would be necessary.
It may seem paradoxical, then, that South Africa's President Jacob Zuma assertively declares that Africa is the most appropriate location for the BRICS bank because "Africa had the greatest need for a bank that would respond to the challenges of the developing world", as he told the opening plenary session of the 2013 World Economic Forum on Africa. It was entitled “Building with BRICS”.
Interestingly enough, the bank could also be considered a failure if it simply replicates the characteristics of the major development finance institutions. Rhetoric about the new paradigms of South-South cooperation have generated expectations that emerging powers of the South have a meaningful contribution to make in the global debate about development. Considering the great differences between the development models of each BRICS member, complex debates lie ahead to establish the rules and norms that will guide the BRICS Development Bank.
Read also:
Creation of BRICS Development Bank looks almost certain
The eThekwini Declaration: An analysis
South-South cooperation: Towards a new paradigm?
India's Vice President Mohammad Hamid Ansari shakes hands with his Botswana counterpart Mompati S. Merafhe during a ceremony in Gaborone in 2010
The idea of south-south cooperation evokes a positive image of solidarity between developing countries through the exchange of goods, resources, technology, and knowledge. It is an attractive proposition, intended to shift the international balance of power and help developing nations break away from aid dependence and achieve true emancipation from former colonial powers.
The surge South-South economic cooperation over the past two decades – including trade, investment, development assistance and other financial flows - is therefore generally seen as a positive development. For example, Brazil’s trade with Africa increased between 2000 and 2012 from US$4 bn to US$28 bn. Partly as a consequence, Brazil has now 37 embassies on the African continent, more than the United Kingdom, and China is Africa’s most important trading partner. China has also become Brazil’s, South Africa and India’s most important trading partner over the past years, growing at higher rates than North-South trade. Trade between Africa and the BRICS has grown so fast that it now even exceeds intra-BRICS trade. The value of exports from developing countries to other developing countries (“South-South” trade) now exceeds exports from poor countries to rich ones (“South-North” trade). China, India and Brazil are also increasingly active as so-called ‘emerging donors’, both in Africa and in their respective neighborhoods.
As a consequence, there is now increased enthusiasm for South-South cooperation, leading to its inclusion on many countries’ foreign policy agendas, in the strategic planning of various organizations, and in the research agendas of some scholars.
As Aileen Kwa of the South Center in Geneva says, in World Trade Organisation
(WTO) circles and discussions, South-South trade is viewed as a sacred cow— not to be disturbed and certainly to be enhanced. Any measure that might lessen the flow of South-South trade is viewed negatively, almost to be avoided at all costs.
Yet an important unanswered question is how South-South cooperation fundamentally differs from South-North cooperation, as is often suggested. Many analyses of South-South cooperation are based on the implicit assumption that trade between Southern states would be less exploitative than that between the South and the North; and, the belief that economic interactions between states of the South would be more responsive to the development needs of the South. Due to the lack of norms and rules established by actors in the Global South, coming up with hard evidence to support these claims is difficult an often remains anecdotal.
Critics of the assumption that South-South cooperation is somehow superior have pointed to what they call the BRICS’ “Scramble for Africa”, indicating that South-South cooperation is increasingly similar to North-South trade as emerging power such as Brazil, India and China are increasingly transforming themselves into major poles of the global economy. In Brazil, strong trade ties with China are often seen not as an opportunity, but as a threat.
This question is not new. Prior to the 2nd BRIC Summit in Brasília, in 2010, Rathin Roy, head of IPC-IG, a joint project between UNDP and the Brazilian government to promote South-South Cooperation, asked:
Will the rise of the emerging economies portend just a broadening of the “great game”, the only result being a little more elbow room for developing countries in their engagement with the G-20 economies? Or will the global South seize this opportunity to forge a new and more inclusive paradigm that secures faster and more sustainable development for all citizens? (…) Can we look forward to exciting paradigm shifts in the discourses on global trade, aid, development cooperation and the rhetoric of best practice? Will emergent regional and global plurilateral groupings afford new avenues for effective development cooperation?
Since South-South cooperation has grown so much, the importance of this question has grown considerably. Promoters of stronger ties among the Global South in Brasília, Beijing and New Delhi regularly argue that South-South cooperation is qualitatively different from North-South Cooperation - for example, loans are said to have fewer strings attached, to be less invasive and less paternalistic. Since donors in the Global South are still fighting poverty themselves, many argue, they are set to be more effective operators in recipient countries. At a recent conference organized by UNDP in Moscow on the BRICS' role in Africa, "win-win situation" was the most frequently used term by far, yet often in a rather fuzzy manner.
And indeed, South-South cooperation is to be welcomed, as I have frequently argued in previous articles. The unprecedented growth of South-South cooperation over the past two decades has undoubtedly helped lift millions in the Global South out of poverty. (Yet this may be the case not only because South-South trade is qualitatively different, but because it generated prosperity at a time when the West was embroiled in a profound financial crisis, affecting trade and cooperation with the Global South.) Still, strengthening ties of all sorts between actors in the Global South democratizes the global conversation and reduces a fundamental imbalance in the global system towards the Global North. Initiatives such as the BRICS, BASIC, IBSA, ASA and ASPA groupings are extremely important because they reduce developing countries’ distrust of one another, making it increasingly difficult for the United States and Europe to split them with bilateral deals (although it still happens, as seen during the selection process of the last World Brank President in 2012).
Yet while praising South-South cooperation unconditionally may work for now, it may also backfire at some point. This is particularly the case in Africa, where growing ties with the Global South are at times seen as a panacea of many problems, and a welcome alternative to North-South cooperation. Systematically holding South-South cooperation to higher standards than North-South cooperation is bound to lead to disappointment among Africans, particularly as long as many areas of South-South cooperation remain largely noninstitutionalized, nontransparent and unregulated. This is particularly the case with development and humanitarian aid as well as lending practices. The BRICS Development Bank is an important step in the right direction, as it will force the leading actors in the Global South to develop rules and norms that will substantiate their claims about the mutual benefits of South-South cooperation.
In the future, the BRICS grouping could be a useful platform to discuss development and humanitarian aid strategies and norms, and perhaps one day turn into an OECD-type organization. That would be an important step towards both institutionalization, and towards assuring that South-South cooperation remains as popular as it is today.
Read also:
Can Itamaraty engage civil society?
Book review: “China’s Superbank” by Henry Sanderson and Michael Forsythe
No final de 2011, durante uma reunião em Nova Déli na qual participaram Shashi Tharoor, ex-Ministro de Estado das Relações Exteriores da Índia, e vários outros diplomatas indianos, um dos palestrantes agradeceu a Tharoor por ter ajudado o Ministério das Relações Exteriores da Índia a “começar a entender como se pode usar as mídias sociais para engajar a sociedade civil”. Ele admitiu que o número de seguidores da conta do Ministério no Twitter ainda era baixo; atualmente está em 79.800. A conta pessoal da Shashi Tharoor, por sua vez, tinha 22 vezes mais seguidores, e está, no momento, em 1.75 milhões, o que faz dele um dos políticos mais populares de nossos tempos. O que parecia certo para os diplomatas ali presentes é que o establishment da política externa indiana precisava fazer mais para engajar a sociedade civil, através de uma estratégia astuta dirigida às mídias sociais, de uma estrutura organizacional transparente, e de uma equipe profissional de funcionários de relações públicas. Se não fosse assim, como poderia o governo indiano angariar apoio público para suas estratégias complexas de política externa, como, por exemplo, para a construção de sua presença militar no Oceano Índico, para o fortalecimento dos laços com a ex-inimiga China, e para criar apoio global para a reforma do Conselho de Segurança da ONU?
Um debate semelhante acontece no Brasil, outra potência emergente que busca desempenhar um papel maior no cenário internacional. Da mesma forma de que na Índia, os formuladores de política externa do Ministério das Relações Exteriores do Brasil, o Itamaraty, lutam para convencer a sociedade civil de que o Brasil deve se tornar um ator global com uma forte atuação em diversas áreas ao redor do mundo. Porém, a política externa desempenha apenas um papel marginal no acalorado debate público brasileiro. Os maiores projetos do Itamaraty são frequentemente recebidos com uma mistura de desinteresse e de rejeição, tanto por parte da mídia quanto pela opinião pública.
Em 2010, quando o Presidente Lula viajou para o Irã para negociar um acordo nuclear com o Presidente Ahmadinejad, a maioria dos formuladores de opinião pública fez duras críticas à decisão, e vários amigos e colegas desaprovaram meu artigo em defesa da viagem. A estratégia brasileira de fortalecer os laços com a África e com o Sul Global é equivocadamente caracterizada, muitas vezes, como uma empreitada puramente ideológica, embora seja lentamente aceita pelo mainstream político. Como escrevi recentemente, a maior parte da sociedade civil, da mídia e da área acadêmica do Brasil permanece cética quanto ao conceito dos BRICS, que é uma das estratégias mais inovadoras do governo para diversificar suas parceiras e pressionar pela reforma da governança global. Por fim, um dos projetos mais ambiciosos do Brasil para o longo prazo, a reforma do Conselho de Segurança da ONU (e a inclusão do país como membro permanente), costuma ser visto pelos cidadãos brasileiros como um projeto de elite quixotesco e amorfo.
Até certo ponto, isso é natural. O Brasil não tem tradição de desempenhar um grande papel na arena internacional. Há apenas algumas décadas, o número de embaixadas brasileiras ao redor do mundo era relativamente pequeno comparado com as 139 embaixadas atualmente mantidas pelo país. A ideia de que o Brasil pudesse ter um papel importante a desempenhar no Oriente Médio teria soado esquisita na década de 90, quando o Brasil apenas começava a se consolidar econômica e politicamente. Estudantes universitários brasileiros e jovens profissionais são a primeira geração que se sente à vontade com um Brasil internacionalmente ativo, profundamente envolvido em regiões distantes que não parecem ter virtualmente nenhum impacto discernível sobre a vida do dia a dia no país.
Portanto, parece ser apenas uma questão de tempo até que a opinião pública no Brasil se acostume a estratégias de política externa cada vez mais ambiciosas. Nas universidades, isso já está acontecendo. Existem mais de 100 cursos de graduação em relações internacionais. Mas o Ministério das Relações Exteriores do Brasil pode, certamente, fazer mais de que ficar parado e esperar que a nova geração tome o controle. Isso é o que argumenta Matias Spektor em um editorial perspicaz publicado pela Folha de São Paulo. Ele coloca parte da culpa pela superficialidade e pela relativa ausência da política externa no debate público brasileiro sobre a falta de vontade do Itamaraty de engajar e tentar ativamente moldar a opinião pública. Segundo Spektor, ao invés de interagir com a imprensa, os embaixadores brasileiros são instruídos a manter um perfil discreto, o que facilita a circulação de falsos rumores e más interpretações por parte de jornalistas frequentemente desinformados. Ele nota, com razão, que escritores muitas vezes se referem à mídia internacional ao invés de contatar o Ministério das Relações Exteriores. No passado, isso causou problemas. Quando o Brasil negociou com o Irã, o Itamaraty não forneceu informações suficientes à mídia nacional, o que permitiu que uma narrativa com influência americana se estabelecesse, segundo a qual o Brasil estava se comportando de maneira perigosa.
Sob o Ministro das Relações Exteriores Antonio Patriota, o Itamaraty tem feito tentativas sem precedentes para engajar a sociedade civil, com diversos convites estendidos a representantes de ONGs e acadêmicos para que participem em seminários. Patriota, que passa 40% de seu tempo viajando pelo exterior, frequentemente dá palestras em universidades e participa em discussões sobre política em think tanks, tais como aquela realizada na FGV do Rio de Janeiro no ano passado sobre a “Responsabilidade ao Proteger”.
Contudo, Spektor também enfatiza que o Itamaraty precisa empregar o Twitter e o YouTube de maneira mais engajadora. É interessante notar que a conta no Twitter do Itamaraty tem quase o mesmo número de seguidores de que a do Ministério das Relações Exteriores da Índia, uma realização bastante impressionante quando se considera que a população do Brasil é cinco vezes menor do que a da Índia.
Mesmo assim, a sociedade civil indiana parece dar maior apoio às aspirações globais da Índia do que a sociedade brasileira dá a seu próprio governo. Há fatores estruturais que podem explicar isso, como a complexidade da vizinhança, as guerras relativamente recentes com o Paquistão e a China, e uma elite anglófona que estabelece laços e redes ao redor do mundo com maior facilidade. A Índia também se beneficia de uma cultura de think tanks que produz uma avalanche anual de artigos e livros contendo pareceres sobre política externa, o que fortalece o debate público. E os formuladores de política externa da Índia também fazem sua parte. O próprio Shashi Tharoor simboliza o crescente engajamento global indiano. Com seu mais recente livro, “Pax Indica”, ele conseguiu engajar leitores que pouco se importavam, antes, com política externa. A palestra do TED de Tharoor sobre a ascensão de seu país foi vista mais de 600.000 vezes no mundo todo e fortaleceu o debate doméstico sobre o papel da Índia em assuntos globais; acredita-se, inclusive, que tenha inspirado muitos jovens indianos a tentarem entrar para o serviço diplomático do país. O Itamaraty certamente tem um número suficiente de diplomatas talentosos para seguir o exemplo de Tharoor.
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In late 2011, during a meeting in Delhi with former Minister of State for External Affairs Shashi Tharoor and several Indian diplomats, one speaker thanked Tharoor for helping India's Ministry of External Affairs "begin to understand how to use social media and engage civil society." The number of followers of the Ministry's twitter account was still low, he conceded (it currently stands at 79,800). Shashi Tharoor's personal account, by contrast, boast 22 times as many followers, currently standing at 1.75 million, making him one of the most popular politicians of our time. What seemed certain to the diplomats present was that India's foreign policy establishment needed to do more to engage civil society - through a savvy social media strategy, a transparent organizational structure, and a professional team of public relations officers. How else would the Indian government win public support for complex foreign policy strategies, such as building up its military presence in the Indian Ocean, seeking stronger ties with former enemy China, and drum up global support for UN Security Council Reform?
A similar debate is taking place in Brazil, another emerging power that seeks to play a greater role on the international stage. Just like in India, foreign policy makers at Itamaraty, the Brazilian Foreign Ministry, grapple with convincing civil society that Brazil should turn into a global actor strongly involved in many issues around the world. Yet quite to the contrary, foreign policy plays only a marginal role in Brazil's bustling public debate. Itamaraty's greatest projects are often greeted with a mixture of neglect and rejection by both the media and public opinion.
In 2010, when President Lula traveled to Iran to negotiate a nuclear deal with President Ahmadinejad, most public opinion makers harshly criticized the decision, and several friends colleagues disapproved of my article defending the trip (Lula’s weekend trip to Tehran: worth a try). Brazil's strategy to strengthen ties with Africa and the Global South in general is often falsely termed as a purely ideological endeavor (although it has slowly been accepted by the political mainstream). As I wrote recently, the vast majority of civil society, media and academia in Brazil remain skeptical of the BRICS concept, one of the governments most innovative strategies to diversify its partnerships and press for reform of global governance. Finally, one of Brazil's most ambitious long-term projects, UN Security Council reform (and its inclusion as a permanent member), is generally seen by Brazilian citizens as a quixotic, amorphous and uninspiring elite project.
To some degree, this is natural. Brazil has not traditionally played a great role in the international arena. Only a few decades ago, the number of Brazilian embassies around the world was relatively small compared to the 139 embassies it boasts today. The notion that Brazil has an important role to play in the Middle East would have seemed outlandish in the 1990s, when Brazil was just beginning to consolidate economically and politically. Brazilian university students and young professionals are the first generation that feels comfortable with an internationally active Brazil, deeply involved in distant regions that have virtually no discernible impact on daily life in Brazil.
Hence, it seems to be only a question of time until public opinion in Brazil will get used to ever more ambitious foreign policy strategies. At university level, this is already happening: There are more than 100 undergraduate courses in international relations. Yet Brazil's Foreign Ministry can surely do more than sit by idly and wait for the new generation to take over. This is what Matias Spektor argues in a thought-provoking op-ed in Folha de São Paulo, one of Brazil's leading newspapers. He partly blames the shallowness and relative absence of foreign policy in Brazil's public debate on Itamaraty's unwillingness to engage and actively try to shape public opinion. Rather than interact with the press, Spektor argues, Brazil's Ambassadors are told to keep a low profile - which facilitates the spread of false rumors and misinterpretations by often uninformed journalists. He rightly notes that too many times, writers consult the international media rather than contacting the Foreign Ministry. In the past, this has caused problems: When Brazil negotiated with Iran, Itamaraty did not provide enough information to the national media, which allowed a US-inspired narrative take hold that Brazil was misbehaving dangerously.
Under Foreign Minister Patriota, Itamaraty has made unprecedented attempts to engage civil society, often inviting NGO representatives and academics to seminars. Patriota, who spends 40% of his time traveling abroad, frequently speaks at universities across Brazil and participates in policy discussions at think tanks, such as one about the "Responsibility While Protecting" at FGV in Rio de Janeiro last year.
Yet Spektor also points out that Itamaraty needs to use Twitter and Youtube in a more engaging way. Interestingly enough, Itamaraty's twitter account has almost exactly as many followers as that of the Indian Ministry of External Affairs - quite an achievement, considering that Brazil's population is more than five times smaller than India's.
Shashi Tharoor
And yet, India's civil society seems to be more supportive of India's global aspirations than in Brazil. There are structural factors that can explain this, ranging from India's complex neighborhood, relatively recent wars with Pakistan and China, and an English-speaking elite that can more easily network its way around the world. India also boasts a think-tank culture that produces a yearly avalanche of foreign policy position papers and books that strengthen the public debate. But India's foreign policy makers have also done their bit. Shashi Tharoor himself symbolizes India's growing global engagement. His recent book, "Pax Indica", succeeded in engaging readers who had previously cared little about foreign policy. Tharoor's TED Talk about India's rise was watched over 600,000 times the world over, strengthened the domestic debate about India's role in global affairs, and is even said to have inspired many young Indians to attempt to enter India's diplomatic service. Itamaraty surely has enough talented diplomats to follow Tharoor's example.
Read also:
Book review: “Pax Indica” by Shashi Tharoor
In Brazil, civil society and academia remain skeptical of the BRICS concept
How many diplomats does an emerging power need?
China's Superbank. Debt, Oil and Influence - How China Development Bank is Rewriting the Rules of Finance. Wiley-Bloomberg Press, 2013
"In one decade", the authors write, "China Development Bank (CDB) has become the financial enabler of both China's global expansion and domestic boom." The bank, according to Sanderson and Forsythe, lies at the heart of China's model of state capitalism - and of what has, over the past years, been repeatedly called the "Beijing Consensus". There are many different ways of seeking to understand China - Richard McGregor, in his excellent book on China's Communist Party, makes a strong argument that the Party lies at the heart of China's political system. Yet Sanderson and Fortsythe also have a point when they argue that in order to understand China at home and how it is influencing the world, examining China Development Bank is a good place to start.
The book does a relatively good job of explaining China Development Bank's system of local government finance that helped urbanize China. Yet while their description of the Local Government Financing Vehicle (LGFV) seems to imply the model is the work of a genius (Chen Yuan), they also conclude that it is about to implode.
The authors' informal writing style makes the - at times rather complex- topic accessible, but it also strikes the reader as somewhat annoying and unnecessary. For example, a Chinese official is quoted while "he sat with colleagues in a smoke-filled room under a No Smoking sign one early June day." Another CDB official was "more interested in drinking beer than talking about how they would pay for their debt." The China Development Bank, "where lunch breaks take two hours", seems to be filled with undisciplined lazy bums - but then why is it the "superbank" the authors claim it to be?
The chapter about China Develoment Bank's involvement in Africa is - quite naturally - more superficial than Deborah Brautigam's fascinating The Gift of the Dragon: The Real Story of China in Africa, yet the authors show that it would be wrong to demonize China's growing presence on the continent. In the end, they rightly assert that it is up to Africans to make the best use of capital available from the Chinese. The book heavily focuses on Ghana and Ethopia, two interesting case studies, yet it may have been interesting to hear about South Africa as well, a country whose relationship with China has become increasingly complex over the past decade.
The account of China's presence in Venezuela, the country with one of the world's largest proven oil reserves - is perhaps the book's most interesting. China Development Bank is putting over $40 billion, about a third of its overseas lending, into Venezuela. How does it manage the risk associated to the investments, particularly considering Venezuela's shaky record as a debtor? In order to avoid problems creditors faced in the past, CDB has assured that repayment is codified into Venezuelan law. Yet China is also careful to assure that its oil-for-loans scheme is seen in a positive light, so that its deals remain valid should the opposition ever come to power. Interestingly enough, China's oil purchases in Venezuela are now so large that it resells parts of it on the global market - turning China into a major trader of oil in the Americas. The book seems to suggest that China benefits more from the agreement than Venezuela does - yet it also accuses CDB of hubris and ignorance regarding the South American country's troubled history, implicitly predicting that China will face the same problems in Venezuela so many other investors have faced before.
Sanderson and Forsythe assert that at some point CDB will have to become more transparent. As any scholar who seeks to study China will notice early on, the authors report great difficulties to obtain clear information. CDB's assets and lending, they say, are "a black hole in the global finance." And indeed, several Chinese institutions have made progress in being more open, for example in the realm of development aid.
In their conclusion, the authors could have been more decisive in their assessment about in how far China Development Bank's practices are sustainable, and - more importantly - in how far they offer a model for other country's banks. Should CDB serve as an inspiration for other national development banks in the Global South? And, can the World Bank learn something by studying CDB? Considering China's growing role in the global debate, and recent discussions about the creation of a BRICS Development Bank, the importance of such questions is set to increase.
Read also:
Book review: “The Party: The Secret World of China’s Communist Rulers” by Richard McGregor
Book review: “The Dragon’s Gift: The Real Story of China in Africa” by Deborah Brautigam
Book review: “What does China want?” by Matias Spektor and Dani Nedal (orgs.)
