THE NEED FOR A PUBLIC PRIVATE PARTNERSHIP: 'Cloud burst' marketing, where local industries are flooded by cheaper foreign goods leading to local industries being displaced by foreign industry, is the threat South Africa faces from BRIC industrialisation in general and Chinese industrialisation in particular.

Flexibility and efficiency will be essential if business is to reposition itself to access niche markets not served by Asian mass production. South African business has adapted well to the strong rand, and while our economy is adaptable enough to handle some trade dislocation, over-regulation will restrict the ability of business and markets to react rapidly enough. Some businesses will be displaced, as happens everywhere all the time, but, given the right environment, others will find new markets and flourish.

As a democracy and without a 'Stalin' type figure, South Africa will find it hard to compete with Chinese wages of $80 a month and we are likely to adapt only very slowly to BRIC competition.

Effective mass healthcare, security, and education cannot be provided by the private sector. Government must do this. Government must also provide a good regulatory environment that supports business and markets and does not inhibit their ability to be flexible.

THE CHALLENGES FACED BY GOVERNMENT: Our government has found natural allies in fellow emerging markets and engaged in a number of free trade agreements that may have a greater political than economic rationale. It is important that the government applies its mind to trade negotiations if we are to extract the maximum possible benefit from such agreements ' particularly with regard to the global impact of BRIC industrialisation.

To better compete with the BRIC industrialisation, South Africa will need further massive industrialisation. While BRIC countries are newly industrialising, South Africa, with its partially industrialised economy, is looking to develop a post-industrial workforce. In thirty years' time western and Asian GDP will amount to a combined total of $120 trillion while GDP in Africa will be $2 trillion. Without full industrialisation South Africa will not be able effectively to compete with BRIC expansion.

THE BENEFIT FOR CONSUMERS: Globalisation and the BRIC boom proffer international economies of scale which can benefit consumers through greater and cheaper access to goods and services. The decline in global consumer prices will lead to lower inflation and improved global income growth. Organised labour may discount such consumer benefits because of job losses, and it will lobby for protection. Trade unions are well organised for lobbying, unlike disparate consumer groups. The ability to mediate between these competing interest groups will be important if South Africa is to meet the BRIC challenge.

TRADE AND THE ROLE OF COMMODITIES: Political leadership and ideology will determine whether countries look to protectionist measures to sustain their economies against BRIC exports.

BRIC growth has already seen a global commodity boom with accompanying rises in their prices. The thirty-year outlook for commodity prices is good and commodity exporting countries such as South Africa have already benefited and will do so further. There may, however, be cyclical interruptions in Asian growth which will have some effect on commodity prices from time to time. However, commodity prices should stabilise again, but at generally increased levels.

The Club of Rome's 1970s predictions of commodity shortages were flawed. BRIC industrialisation may cause environmental damage and climate change but commodity shortages will not present an obstacle to economic expansion in BRIC countries. Commodity demand will present a great opportunity for South Africa, with its natural precious metals endowment and access to the rest of Africa, to improve levels of investment and infrastructure both in the country and on the continent. But, as Dr Bruggemans wrote in the Sunday Times of 11 September 2005, the extent of such benefits will depend on, 'infrastructure and good governance, the rule of law, enforceable contracts, property protection and royalty agreements'.