After the 2018 G20 Leaders Summit in Argentina, Mr. President. R. Tayyip Erdogan met with the press members and one of the questions posed to the President is whether Turkey will be a member of the BRICS in the upcoming period.Mr. President answered this question with the message of “Turkey's membership leans towards on the eyes of Russian and Chinese Presidents.”
We tried to evaluate this question in the topics of formed commercial energy between BRICS countries, their objectives and institutional steps they take or economic cooperation framework that can be done with these countries in terms of possible accession of Turkey in light of the current economic indicators of BRICS countries.
These countries which are recognized by many experts as the rising power of the world were established in the UN meetings in 2006 and showcased by the first Leaders Summit held in Russia in 2009 and our President R. Tayyip ERDOĞAN participated in the last Leaders' Summit (10th) as a special guest in South Africa.
BRICS countries consisting of Brazil, Russia, India, China, and South Africa have a nominal gross domestic product amount of USD 18.6 trillion. Approximately 30% of the global economy, 17% of global trade, 40% of the world's population, one-third of the world's industrial production, and about half of the agricultural production belong to these countries.
While the trade volume between BRICS countries was 567 billion USD in 2010, this figure increased to 744 billion USD in 2017. The average annual growth rate of BRICS countries for the period 2008-2017 was 5.4% and the period 2023-2030 is estimated to be between 4.5% and 4.7% annually, therefore the BRICS countries will be the locomotive of global economic growth.
Although the trade and customs policies of the Trump administration pose a risk to global economic predictability and stability, this new picture also brings about some developments that may lead to new global partnerships and opportunities by bringing some countries and blocks much closer to each other.
Becoming a member of BRICS or developing close relationships with these countries could give a chance to Turkey in terms of volume of trade and direct foreign capital investments. The production, trade and investment capacities of BRICS countries are quite high. The total foreign trade volume of the five countries in 2017 was 5.9 trillion USD. In 2017, China invested USD 125 billion, Russia 36 billion USD and India 11 billion USD in other countries. In 2017, direct foreign capital investment figures to these countries are;
- China 136,320 billion USD,
- Russia 25,284 billion USD
- India 39,916 billion USD
- Brazil 62,713 billion USD
- South Africa 1,325 billion USD
A new development bank was established by BRICS countries in 2014 with a capital of 100 billion USD, which can be used both in BRICS countries and other developing countries; aims to provide funds for infrastructure and sustainable development projects. In the upcoming period, the bank is aimed to have stronger capital and to extend more loans.
Turkey's total trade volume between the BRICS countries in 2017 was 60.7 billion USD. In this period, Turkey's exports to 5 countries are 7.3 billion USD while imports are 554 billion USD. In terms of the table, the export figures for Turkey is heartwarming.
On the other hand, according to UNCTAD data; In 2016, global direct foreign investment was USD 1.81 trillion. Turkey's share of this money is received 12.942 billion USD. In 2017, global direct foreign capital investments amounted to USD 1.52 trillion. Turkey's share did not exceed USD 10.864 billion. It is hard to say that, Turkey is taking the deserved share from the global direct investment despite its young, well-educated and skilled workforce.
Despite all these difficulties, there are great opportunities in front of Turkey. It is quite possible to cooperate with BRICS countries based on a win-win strategy. China and India are aiming to increase its current trade volume with the European countries due to the recent trade and tax policies of the USA. From their perspective, Turkey is a gateway to Europe. Because of Russia cannot solve problems with Ukraine for a while, Russia needs Turkey especially about the transmission of energy such as natural gas. Diplomatic and trade relations which developed with African and South American countries will contribute to economic cooperation with South Africa and Brazil at present and the future.
Beyond all of these parameters, when we add that economic power shifted from the West to the East, Turkey's geostrategic advantage comes forward once more. If Turkey can seize the opportunity, not only the BRICS countries but also many countries from different regions in the world will invest in Turkey and want to develop their trade relations with Turkey.
