Libya and the BRICS: Currency Wars, Imperial Wars and Popular Uprisings

BRICS_550356eOn one side of the world NATO bombs Libya and on the other, the newly expanded BRICS (Brazil, Russia, India, China and South Africa) meet on the island of Hainan, off the south coast of China. Two seemingly unrelated events. But there are links and forces at play fuelling important new power contestations in the world.

Western bombs are raining down on Libya and a “no-fly zone” is being imposed after a United Nations (UN) Security Council resolution. At the UN, BRICS members, China and Brazil, abstained from voting (although South Africa voted for) but publicly criticised the idea of bombing Gaddafi’s forces.

The US is in decline as the power able to exert its authority over world affairs. At the same time we are seeing the rise of China – predicted to be the world’s largest economy within 10 to 20 years – having imperial ambitions, but racked with many internal contradictions. China is the single biggest holder of the US’ debt, in the form of federal bonds. Its rise is offset by its dependence on the US for its exports and on US companies that are its biggest foreign investors. Moreover, holding dollar-denominated US treasury bonds also means that China can't simply watch the dollar decline or risk a US bond default.

Read more: Libya and the BRICS: Currency Wars, Imperial Wars and Popular Uprisings

South Africa's Muted Response to the Global Crisis

People the world over are facing an economic crisis unseen since the Great Depression of the 1930's. Despite the talk of "green shoots" and the emergence of the United States of America (US), Germany, France and others from recession, this "recovery" (if one can all it that), is extremely fragile. Witness the scare of Dubai World defaulting, and at some stage the costs of some US$14 trillion dollars will have to be carried somewhere.

The long wave of decline in capitalist accumulation that began in the 1970's is reasserting itself after the stock exchange bubbles of the 1990s and early 2000s. Major states have tried everything from cutting interest rates to (almost) zero, to partial nationalisation, to buying the debt of corporations, to printing money (also known as quantitative easing).    

Read more: South Africa's Muted Response to the Global Crisis

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