Global Courant
After weeks of economic turmoil and uncertainty surrounding Russian President Vladimir Putin’s participation in a BRICS summit in South Africa later this year, it now appears he will skip the event.
According to The Sunday timeshad convinced President Cyril Ramaphosa Putin to stay home, citing sources close to the matter.
Ramaphosa was recently in Russia as part of a delegation of African leaders seeking peace between the country and Ukraine, which it invaded in February 2022 and has been at war ever since.
The South African president reportedly took the opportunity to present Putin with three options around the BRICS summit: stay away, attend virtually or attend in person but at a different location.
Putin favored option one, the sources said, with Russian Foreign Minister Sergey Lavrov expected to come in instead.
Why is it such a big problem?
The issue of Putin’s presence has wreaked havoc in South Africa to the extent that it directly affects local markets.
The International Criminal Court (ICC) has issued an arrest warrant for the Russian leader for his role in the alleged abduction and trafficking of Ukrainian children to Russia.
As a party to the ICC, South Africa would be obliged to arrest Putin if he enters the country, with no legal way out. The government has been reticent about its intentions on the issue, while the story continues that South Africa is friendly and pro-Russia – drawing the wrath of Western countries.
Markets panicked as this narrative gathered momentum in recent months, peaking after economists, analysts and even the South African Reserve Bank signaled risks of the country facing secondary sanctions over its ties to Russia.
This sent a message to markets that the country would jeopardize more than R400 billion worth of trade deals with Western countries if it continued its alleged support for Russia.
Not clear yet
Ramaphosa has taken steps to break this narrative in recent weeks, and if Putin avoids the BRICS summit, the pressure on South Africa to do so will be greatly eased.
Without the complex and politically fraught conundrum of the arrest of the president of a key BRICS partner, the government can turn its attention to other foreign policy tensions.
The Ramaphosa-led African delegation to Russia and Ukraine has already tried to quash rumors that South Africa is pro-Russia – the president has made it clear that the war must end and peaceful measures must be taken. be taken – but the question lingers whether or not South Africa gave military aid to Russia.
The country faces an uphill battle that shakes its pro-Russian perception.
U.S. Embassy allegations that South Africa armed Russia in December 2022 when the Lady R docked in Simon’s Town under cover of darkness are still under investigation.
But even beyond that, participating in war games with Russia on the anniversary of Ukraine’s invasion, allowing sanctioned ships and planes to land in military ports, and anti-Western expressions from the ruling party and other politicians may not be so easily brushed aside. .
According to Annabel Bishop, chief economist at Investec, concerns about South Africa’s proximity to Russia are rampant, keeping investors at bay.
The Institute of International Finance (IIF) recently flagged South Africa’s ties to Russia and possible sanctions as a key risk – a position that has been echoed time and time again in several reports on the country’s growth prospects.
As for South Africa, the IIF noted, “the direction of non-resident capital flows in the near term will depend on whether the West imposes sanctions on South Africa, whose external financing needs are expected to increase in line with growing current account deficit.”
The IIF warned that investors would remain “extremely sensitive to developments in South Africa’s relations with Russia” and that findings about South Africa’s ties with Russia represent the main near-term risk.
“Western sanctions would lead to a sharp sell-off of South African assets, increase external financing risks and lead to possible rating downgrades,” the report said.
Read: South Africa risks 10% of GDP for love of Russia
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