About ten years ago, Jim O’Neil at the well-known investment bank Goldman Sachs coined the acronym BRIC for four emerging countries that were regarded to have a common potential of shaping global markets in the not-too-distant future: Brazil, Russia, India and China. In 2003, Goldman Sachs published a report named “Dreaming with BRICs: The Path to 2050”. Its key message was that the economies of these four countries together, which at that time made up only 15% of the global economy, could by 2050 be larger than those of the (former) G6. They claimed that, given that their predictions come true, the list of the world’s major economies could look very different from today’s in less than 40 years – a perspective which must naturally have an influence on investing behavior around the globe (see Wilson, Purushotaman 2003). The reasons for these expectations were the BRICs economic growth rates, which topped those of the industrialized nations by far, as well as their huge share of global population which promised emerging masses of consumers.
In 2010, Goldman Sachs could proudly announce the fulfillment of their 2001 predictions (Wilson et al.). The past decade had indeed seen a rise in political and economic power of these emerging countries, so, according to Goldman Sachs, there were no reasons to doubt that the BRICs future growth would as well be satisfying their forecasts (ibid. 2). Another report from December 2009, which concentrated on the BRICs’ survival of the global financial crisis had even confirmed that these countries (with the sole exception of Russia) were emerging healthier from it than the industrialized world – a development which gave reason to expect yet better long-term performance than they had originally prophesized ten years ago (O’Neill, Stupnytska).
However, critics argue that the entire concept of BRIC has flaws – it might appear forced to group four countries that seem to have very little in common. The prediction of their future role in global affairs seems rather bold and even if in terms of economics the BRICs fulfill the expectations – what does this mean for their general role in world affairs? This paper shall have a closer look at the BRIC group and its actual and predicted development. The sense of an analytical concept that was applied to four such different countries shall be examined by pointing out there commonalities and differences.
Table of Contents
- Introduction
- Why The BRICS Might Be a Group on the Rise
- Economic and Demographic Developments
- Regional Preponderance and Cooperation
- Most Striking Differences and Challenges
- Conclusion
Objectives and Key Themes
This paper aims to provide a deeper understanding of the BRICS group, examining their current and predicted development. It explores the factors contributing to their potential rise, analyzes their commonalities and differences, and assesses their future role in global affairs.
- Economic growth and demographic changes within the BRICS
- Regional influence and cooperation amongst the BRICS
- Significant differences and challenges facing the BRICS
- The BRICS's potential for shaping the global order
- Comparison of BRICS with other emerging powers
Chapter Summaries
- Introduction: Introduces the concept of BRICS, highlighting their potential impact on global markets based on economic growth and demographics. The paper outlines its aim to analyze the BRICS group and its development.
- Why The BRICS Might Be a Group on the Rise: Discusses the reasons behind the projected rise of BRICS, focusing on economic and demographic factors, and their potential for regional and global influence.
- Economic and Demographic Developments: Examines the economic growth and demographic trends within the BRICS, analyzing the differences and commonalities between the four countries. This section explores the significance of the rising middle class in BRICS nations.
Keywords
The key terms and concepts explored in this paper include: BRICS, emerging powers, economic growth, demographics, regional influence, global order, middle class, foreign investment, and international relations.
Frequently Asked Questions
Who coined the acronym BRIC and what does it stand for?
Jim O’Neill at Goldman Sachs coined the acronym in 2001. It originally stood for Brazil, Russia, India, and China (South Africa was added later to form BRICS).
Why were these countries grouped together?
They were regarded as emerging economies with high growth rates and large populations that had the potential to shape global markets and surpass the major industrialized nations by 2050.
What was the key message of the "Dreaming with BRICs" report?
The 2003 report predicted that the combined economies of the BRIC nations could be larger than those of the G6 within less than 40 years, significantly shifting the world's economic balance.
How did the BRICs handle the 2008 financial crisis?
According to Goldman Sachs reports, most BRIC countries (with the exception of Russia) emerged from the global financial crisis healthier than the industrialized world, confirming their long-term growth potential.
What are the main criticisms of the BRIC concept?
Critics argue that the grouping is forced because the four countries have very little in common politically and economically, and that predicting their future role in global affairs is overly bold.
- Quote paper
- Natascha Strenger (Author), 2011, Understanding BRICs, Munich, GRIN Verlag, https://www.grin.com/document/195157
