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SAIIA Occasional Paper No 118, July 2012

Download the Occasional Paper from the SAIIA website [English - pdf].

Overview

The World Trade Organization is in a state of flux. This stems largely from the Doha Round impasse and the failure of the main protagonists to reach agreement. However, it is also the effect of a changing global political economy.

The World Trade Organization is in a state of flux. This stems largely from the Doha Round impasse and the failure of the main protagonists to reach agreement.

However, it is also the effect of a changing global political economy. With the rise of the emerging economies, decisions reached before at the World Trade Organization are not so easy to make anymore.

News headlines were last week screaming about the US$2 billion pledge that South Africa made to the IMF. Ranging from descriptions of the pledge as a gift or donation to statements that South Africa was bailing out the EU, most of the headlines and the stories fell short on the facts and didn't show much understanding of the economics behind the pledge.

Worse still, the fact of the 'pledge' was largely ignored and, from the public debate, one got the definite impression of a South Africa punching above its weight to donate money to save an embattled Europe at the expense of many other domestic priorities the country is facing, such as poverty and unemployment. Some questioned the wisdom of South Africa contributing towards keeping the EU rich while we get poorer. With all the alarmist headlines, the average South African is left baffled as to why the government had made such a commitment.

Media reports in the run up to the BRICS summit (in New Delhi, 29 March 2012) as well as immediately after touched on a variety of issues pertinent to the BRICS grouping currently. A review of some of the leading publications showed the main stories were around the issue of South Africa's membership, currency issues, the World Bank presidency, the proposed BRICS development bank as well as the issue of Iran and its nuclear weapons programme. The following is a brief synopsis of the media reports.

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