BRICS BUSINESS COUNCIL
October 15, 2016, Goa, India
The meeting of the BRICS Business Council took place on October 15, 2016, on the sidelines of the Eighth BRICS Summit in Goa, India.
The BRICS Business Council’s Annual Report 2015-16 was finalized here today, after incorporating key suggestions from the seven Working Groups of the Council, namely Agribusiness, Energy and Green Economy, Financial Services, Infrastructure, Manufacturing, Skills Development and Deregulation. The Annual Report 2015-16 of the Business Council will be presented to the BRICS Heads of States on October 16, 2016.
The BRICS Business Council has contributed to intra-BRICS economic co-operation, especially by identifying areas of co-operation from the perspective of the private sector. In its Annual report, BRICS Business Council reports on various intra-BRICS business initiatives during 2015-2016 and sets out actions that BRICS economies could take to enhance economic, trade and investment ties amongst the BRICS countries.
Some of the key recommendations of BRICS Business Council for the BRICS Government to strengthen the economic and financial cooperation amongst the member countries are:
- BRICS Social Security Agreements
The BRICS Business Council supports the idea of creating a ‘BRICS Social Security Agreements’ or bilateral agreements amongst BRICS countries, with a view to alleviating the burden of dual social security contributions. Such agreements will make it possible for the periods of service rendered by employee in the host countries to be combined to determine eligibility for social security benefits. The Social Security Agreements will thus benefit workers moving across borders and also the companies as it will reduce the cost of doing business and create social safety nets.
- Financial Framework for Sustainable Development
Promoting a financial framework for sustainable development is one of the key areas of cooperation among the BRICS for ensuring inclusive development. There are huge opportunities to collaborate on climate change technology, climate finance adaptation measures and other sustainable development areas. BRICS Business Council recommends drawing up a financial cooperation program for sustainable development projects. The Council has suggested that the New Development Bank may fix a specific percentage of its resources for funding sustainability projects aligned to achievement of SDGs in BRICS nations. The BRICS Business Council commends the progress made in the signing of co-operation agreement between the relevant Development Finance Institutions
- BRICS Infrastructure Project Preparation Facility
BRICS Business Council has sought support of New Development Bank in setting up of a BRICS Infrastructure Project Development Facility. Such an organization can provide assistance on the entire gamut of project development expertise including project identification, pre-feasibility, post-feasibility, preparation of DPR and environment & social impact assessment. Through such a platform, projects can be converted from conceptualization stage to the bankability stage. In countries where such an institution exists, NDB can help enhance such structures and where there are none, NDB can help set up an independent unit.
- Local Capital Markets development through New Development Bank
To unlock capital markets in BRICS countries for development financing, the BRICS Business Council has sought support of the New Development Bank in development of deep and vibrant local bond markets in BRICS countries. This would further provide governments and corporates with an alternative and cost effective source of debt funding, especially for green economy projects.
- BRICS Angels Network
The BRICS Business Council has recommended creation of a BRICS Angels Network, which can help talented young entrepreneurs across BRICS countries to create an eco-system of start-ups, thereby fostering entrepreneurship and promoting innovation among the BRICS economies.
- BRICS Trade Settlement in Local Currencies
To promote common interests and objectives of BRICS countries on trade, business, investment and manufacturing ties, the BRICS Business Council urges the respective governments to expand the scope and scale of pricing in local currency for intra-BRICS transactions and to develop the necessary infrastructure to support such payments.
- BRICS co-operation in Agri-business
Agri-business is one of the key priority areas for intra-BRICS co-operation. BRICS Business Council support enhancing this co-operation by sharing best practices related to sustainable agriculture production, productivity, environment protection and food security and contributing towards research activities in these areas.
BRICS nations can work together to manage and disseminate knowledge on sustainable approaches to agricultural technology. They can also jointly develop technical programmes to support innovation in mechanization and facilitate the implementation of sustainable technology initiatives at the field level. Exchange of knowledge on water conservation is also of critical importance. The idea of a BRICS Seed Bank has also been discussed in the Business Council
- BRICS co-operation in Energy
In order to build a common and strategic long term view about the future of their energy sectors, and a productive business environment among the BRICS countries, Business Council recommends developing a broad guideline, including definitions; approaches, recommendations on enabling policies and enabling environments for promoting effective mechanisms for cooperation; knowledge transfer and corporate partnerships related to energy within the developmental mandate of BRICS countries. In addition, the countries should accelerate R&D into renewable energy, the development as well as transfer of energy efficient and environmentally friendly technologies and equipment and establish centers of excellence in BRICS countries to share the unique capabilities of each country.
BRICS Business Council has also requested the New Development Bank to establish a BRICS renewable energy fund and to adopt a set of specific polices within the NDB to provide support for the implementation of the energy projects in BRICS and other emerging economies.
- BRICS Co-operation in Skill Development
The BRICS nations should increase bilateral and multilateral cooperation in skills development for Industry 4.0. The skill development institutes across the BRICS nations can collaborate to innovate and develop cost-effective learning tools related to Industry 4.0. BRICS nations can also collaborate towards the development of a standard qualification framework. Such a standard qualification will support a worker’s mobility from one BRICS nation to another BRICS nation and, at the same time, will allow him or her to pursue education for the next level of qualification, avoiding any repetition.
Since skill development is a focal area for all BRICS countries, the Business Council has also recommended establishing a Skills Development Fund, in order to provide financial support to the projects in the field of training and quality education.
- BRICS Co-operation in Manufacturing
Manufacturing sector is a priority area of co-operation. BRICS nations should continue to promote and increase value added trade and manufacturing amongst themselves.
- BRICS Trade Facilitation Network
To facilitate trade as well as to advance cooperation initiatives, including the provision of technical assistance to developing countries, the BRICS Business Council has recommended that the governments continue trade facilitation efforts considering the perspective of private sector.
- BRICS Standardization Research Framework
To ensure best practices on institutional and policy mechanisms on various regulations and standards across BRICS countries, the BRICS Business Council suggests setting up a BRICS Standardization Research Framework. Such a framework can facilitate better harmonization of trade and investment policies among BRICS economies and help find effective solutions for removal of trade barriers
- Advisory role and observer status for BRICS Business Council in New Development Bank
Private sector participation and involvement in various government discussions, dialogues and policy formulation is essential to find practical and effective solutions to address the issues and challenges faced by our economies. It is in this context that BRICS Business Council can be effectively engaged as an advisory council to the New Development Bank. BRICS Business Council has requested the New Development Bank to provide observer status to the chairpersons of the BRICS Business Council.
- Cooperation and Facilitation of intra-BRICS Investments
The BRICS Business Council reiterated the importance of the Common Declaration on Investment Principles, adopted at its meeting in July 2015, in Ufa, Russia, and reaffirmed its commitments, asking the Governments to discuss forms of enhancing cooperation and facilitation of intra-BRICS investments.
In addition to the above, there are a few other areas that were examined by the BRICS Business Council. In relation to the BRICS Rating Agency and New International Payment Card System proposals, some members of the BRICS Business Council feel that there is a need for further discussions.
BRICS Rating Agency
The idea of a Rating Agency that takes into account the emerging market realities has been discussed by the Council members. While most members felt that such an institution could eventually provide a more thorough and complete credit rating analysis of companies in the BRICS countries, some concerns have also been highlighted that need further deliberations. It was suggested that BRICS countries should also study how to establish cooperation to develop markets for private credit rating agencies.
New International Payment Card System for BRICS
The BRICS Business Council members are discussing an international payment card system among the BRICS to promote settlements of international transactions in national currencies. The Financial Services Working Group has created a sub-group that would focus on the proposal of a New International Payment Card System. It is also suggested that Central Banks of member countries be engaged in these discussions to take into account the interests of all BRICS countries.
About BRICS Business Council
The BRICS Business Council was established with the objective of pursuing common interests of BRICS nations to promote mutual trade and investments among the member countries.
The meeting of BRICS Business Council on October 15, 2016 was chaired by Mr. Onkar S Kanwar, Chairman of the Indian BRICS Business Council and Chairman -Apollo Tyres. Chairpersons of National Chapters of other BRICS Countries who were present in the meeting were – Mr. Sergey Katyrin, Chairman of Russian BRICS Business Council and President – CCI of Russian Federation; Mr. José Rubens de La Rosa, Chairman of Brazil BRICS Business Council and Advisor – Marcopolo;Capt. XU Lirong, Chairman of China BRICS Business Council and Chairman – COSCO SHIPPING; and Mr. Brian Molefe, Chairman of South African BRICS Business Council and Group Chief Executive – Eskom Holdings SOC.