The Importance of the BRIC Countries-Exploding Development!
The BRIC Countries: Brazil, Russia, India, China
The BRIC countries are made up of Brazil, Russia, India and China – although if we were to categorize them by importance, it would actually be CIRB. It just doesn’t sound as sexy, does it?
And lets face it, sexiness sells, and that is why the masters of the universe at Goldman Sachs make the big bucks – for it was Goldmans who came up with the BRIC grouping, and it has stuck.
Why the BRIC are Important
The BRIC are both the fastest growing and largest emerging markets economies. They account for almost three billion people, or just under half of the total population of the world. In recent times, the BRIC have also contributed to the majority of world GDP growth.
According to various economists projections, it is only a matter of time before China becomes the biggest economy in the world – sometime between 2030 and 2050 seems the consensus. In fact, Goldman Sachs believe that by 2050 these will be the most important economies, relegating the US to fifth place.
By 2020, all of the BRIC should be in the top 10 largest economies of the world. The undisputed heavyweight, though, will be China, also the largest the creditor in the world.
Apart from their growth characteristics, the BRIC countries frankly have little in common. They are primarily an investment category now, although there may some political and economic alliances that develop from that grouping. If they do, it is likely to be temporary – once China has assumed its rightful place, it may have no need for these alliances. A G2 of China and the US may be more important for it unless the 2050 predictions do come true.
In 2008, the BRIC countries had a summit and analysts believed that they were seeking to ‘convert their growing economic clout into political power’.
These analysts believe that by working together, the BRIC countries can carve out the future economic order between themselves. They believe that China can dominate in manufactured goods, India in services, and Russia and Brazil in raw material supplies.
By working together, they can effectively counter the entrenched interests and organisational structures of the west.
In reality, right now, relations with the US, the EU and bilaterally are more important, but it is worth watching developments between BRIC nations to see if these notions start to become entrenched in active co-operation.
More on the BRIC Countries