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Labour should no longer be spokespersons of their governments Dangers of bourgeois nationalism If the labour federations in BRICS, including in AGOA and other multilateral trade bodies, are not cautious, they will endorse, carry and champion the capitalist agenda of their national bourgeoisie, without paying due regard to the class struggle. The fact that some are already speaking in terms of their national governments, means this danger is not a thing of the future, but has become a living reality. In our view, this is caused by the degeneration in the labour movement that is caused by trade unions that are drawn closer to government through alliances. To evade these dangers, trade union federations in the BRICS bloc will have to come together on a common programme of struggle. In this context, the high-level discussions on trade, competition and development will not be about echoing the declaration of our governments, but to forge a common programme of struggle against exploitation, privatisation, and fiscal austerity. For instance, the BRICS governments declaration in 2013 committed to debt sustainability, a repetition of the neoliberal mantra established under the Bretton Woods regime to whip countries into fiscal consolidation paths. In recent years, the governments of India, Brazil and South Africa have implemented fiscal austerity.Instead of congregating to echo our governments as if we approve their policies, trade union federations ought to be establishing a common platform to fight the imposition of austerity measures. SAFTU brought a motion for insertion in the declaration, to commit the federations to fight against the privatisation in the process of the clean energy transition. This motion was elbowed aside on grounds that it was submitted late. Yet if we are anti-exploitation and anti-capitalist, as the unfolding energy transition is being privatised, our opposition towards it must grow louder. Our longing and commitment to dethrone the Bretton Woods multilateral regime must not blur the class struggle i.e., our struggle with our national bourgeois for the share of surplus continues. Something that tends to even blur this concretely in our psychic, is the continuous referral to comrades by the name of their countries. BRICS BRICS was meant to offer a multipolar alternative, in the context of the unfair multilateral system that favours the US and Europe. The west has used their post-war hegemony through the Bretton Woods financial institutions (the World Bank and IMF) and the World Trade Organisation to allow their own corporations to dominate global trade. This became even more acute in the 1970s, when the global economy stagnated as a result of the overaccumulation crisis that built up in the Western economy as multinationals competed for the world market. In the context of the overcapacity, the multinationals that could win global trade, were those that could lower their input costs and undercut their competitors. Multinationals from advanced world migrate production to East Asia, where unit costs of labour were low, independent unions were not allowed and environmental, safety and health regulations non-existent. In addition to offshoring, these multinationals benefitted from the World Bank and IMF structural adjustment programmes that turned the neo-colonial world into a destination for Foreign Direct Investment, to extract minerals and profits cheaply. And soon it was the BRICS own companies that also took advantage of the poorest countries’ misery. So, in the context of the treacherous role played by IMF and World Bank, an alternative multilateral regime is necessary. The question however is, will a BRICS that is still premised on a capitalist framework provide an alternative so desperately needed? Imperial-capitalism and Disappointments One area where the Bretton Woods had a stranglehold, and still very much do, is in controlling finance and dictating policy recommendations that serve the interests of imperialist corporations from the advanced neo-colonial countries. Disappointingly, instead of forging a new developmental path away from the Bretton Wood institutions, the BRICS governments still tail the recommendations of the IMF and World Bank. They have increased their ownership in both institutions, yet the leadership seems to be getting more corrupt, anti-social and anti-environmental – and the Bank president is still inevitably a U.S. citizen while the IMF’s leader is always European. And the neoliberal agenda hasn’t changed. In its 2022-26 Country Partnership with South Africa, the World Bank asserted that a “sustained pace of reform and level of fiscal consolidation will mean that difficult policy choices will be required,” such as cuts in public services, privatisation of state-owned enterprises, and shrinkage of the civil service wage bill. The BRICS’ failure to establish a new, independent financial institution makes this all the more discouraging, because if the $100 billion Contingent Reserve Arrangement is tapped, it still means empowering the IMF since after taking 30% of our quota as a loan, to get the next 70% requires having an IMF structural adjustment programme in place! The BRICS New Development Bank also confirms the bloc’s failure to offer an alternative developmental model to its members. That is why it was no surprise the BRICS Johannesburg II Declaration (the first having been in 2018) illustrating the leaders’ ongoing obedience to Western neoliberal institutions, as articulated in a half-dozen resolutions supporting: “a rules-based multilateral trading system with the World Trade Organisation (WTO) at its core... a market-oriented agricultural trading system... a robust Global Financial Safety Net with a quota-based and adequately resourced International Monetary Fund (IMF) at its centre… [with] increases in the quota shares of emerging markets and developing economies (EMDCs)… including in leadership positions in the Bretton Woods institutions… global consensus on economic policies… the importance of the G20 to continue playing the role of the premier multilateral forum in the field of international economic and financial cooperation… We note the opportunities to build sustained momentum for change by India, Brazil and South Africa presiding over the G20 from 2023 to 2025.” De-dollarisation The other area where Sandton demonstrated dismal political will, is the need to urgently reform the global currency regime. The global monetary regime dominated by the US dollar as the base currency, has been a problem amongst which enables the US imperialism to bully and influence economic policy. In December 2022, the Bank of International Settlements reported that half of the world’s trade is conducted/invoiced in US Dollars. Though there has been some gradual decline in the past 19 years, the US Dollar still accounts for over 60% of the Foreign Exchange Reserves. In addition to this, about half of the cross-border loans and international debt securities are issued in US dollars. These figures testify that the US dollar is the base currency of the world. Even the BRICS New Development Bank only lends 22% of its current portfolio in local currencies. The position held by the US dollar unfairly advantages it against other currencies and affects trade relations generally. By holding the dollar as base currency, the US can lay a claim over values produced by the working class across the world, without having to match the toil, simply by printing currency (‘Quantitative Easing’). In addition, this position strengthens the dollar when there is financial turmoil – even if it emanates from the U.S. - because the dollar is a hedge and ‘store of value.’ The devaluation of the dollar in such a position, is unthinkable. Moreover, the U.S. Federal Reserve – which decides on printing dollars – determines the pace of the monetary policy and interest rates across the world. Fearing devaluation against the US dollar, central banks of many countries have tailed the Fed’s hiking of interest rates since early 2022, so that they can incentivise the sellers and buyers of currency to hold onto it, rather than dumping it in the forex market. Our central bank, the SARB, is doing this even at the risk of recession. The lack of serious engagement by trade unions and others in civil society, and the tendency to hype the BRICS as anti-imperialist when in reality they are sub-imperialist, means we have not yet provided an alternative monetary regime of exchange. There has been regular rhetoric about striving to “reform the financial architecture” since the 2008-09 global financial meltdown. Yet in the BRICS 2023 declaration, the only mandate along these lines was to “task our Finance Ministers and/or Central Bank Governors… to consider the issue of local currencies, payment instruments and platforms and report back to us by the next Summit.” Kicking the can down the road in this manner, after the delay in reforming world finance over the years, leaves a shadow of doubt about whether the BRICS are serious about reforming, or instead their conservative leaders enjoy the status quo. https://www.amandla.org.za/amandla-89-crisis-failed-agrarian-reform/ Back |
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