Is the whole greater than its components? : a new regionalist analysis of the India-Brazil-South Africa (IBSA) dialogue forum

Abstract

There is a complex set of variables influencing a country's potential for economic growth. One of these is investment, and in order to attract foreign capital flows a country needs, amongst other things sound macro-economic policies and solid financial institutions. Solid financial institutions must be coupled with an attention on integration of a country's financial markets. Through the building of these institutions and a focus on integrating its financial markets a country is likely to become more attractive in the eyes of the investors. The reason for this being important is that investment carries with it promises of economic growth and the subsequent social upliftment. Therefore, closer cooperation between the IBSA members is likely to offer great opportunities for India, Brazil and South Africa. It has been highlighted that a closer integration of their financial markets might lead to them also becoming competitors in the quest for the attention from the investors of the North. However, the loss in terms of competition is likely to be outweighed by the benefits found in not having to face unilateralism as separate entities. New Regionalism stresses the importance of regionalisation as a counter measure to the harmful effect of globalisation for the marginalised countries of the world, and the topic of investment aptly illustrate this point. Furthermore, a closer collaboration between the IBSA members as well as a continuous focus on further integrating their financial markets into the world economy could offer great benefits. Moreover, the trickledown effect could also broaden the scope of these benefits to include other emerging markets. Because of this, investment is, amongst other very important sub-sectors of focus in terms of IBSA cooperation, one of the most important one - both in terms of benefits for the individual countries, but also due to what a successful cooperation could come to mean for the developing world in general. The next chapter, the conclusion, will draw together the various discussion of this thesis in order to highlight the arguments put forward and to suggest ways forward for the IBSA coalition, as well as possible fields of further study