In his 2001 technical paper “Building Better Economic BRICs,” Jim O’Neill, an economist in the Global Economic Department of Goldman Sachs, coined the term BRIC, an acronym for Brazil, Russia, India and China. According to research conducted by O’Neill, the BRIC nations are unique in their accelerated growth compared to other developing nations in the world. The four BRIC nations have the potential to overtake many of the more mature economies of the world within the next 30 years. The acronym BRIC has transformed into more than just a word, if not a brand. In an attempt to capitalize on the success of the BRIC nations, BRIC business strategies, BRIC business courses, BRIC investment funds, and numerous other plans claiming to employ methodology mimicking that of BRIC nations have been developed. This study first discusses the relationship of the BRIC nations as a whole, proceeds to review the events which have taken place since the origination of the term “BRIC”, and concludes with an in-depth analysis of each BRIC nation on an individual basis. Overview of BRIC
As previously stated, the BRIC nations were first grouped together in late 2001 by Goldman Sachs. After the attacks on September 11, 2001, despite the many non-economic differences between them, the decision was made to group Brazil, Russia, India and China based upon their economic similarities. It was becoming apparent that countries outside of the western world were quickly developing the ability to become a global power. Brazil, Russia, India, and China were already labeled as emerging markets, and each were beginning to grow economically, but the new term evidenced a new respect for the potential that each had. The most prominent attributes shared by the BRIC nations were that each had large populations, underdeveloped economics, and governments willing to enter the global markets (Tett 2010).
In sum, the BRIC nations account for over 42% of the world’s population. Half of the population in the BRIC nations is under 30 years of age (Young 2006). These demographics are one of the primary reasons that rapid growth is possible. The large, young populations provide a massive, energetic workforce resulting in tremendous job competition and have allowed the BRIC nations to produce huge quantities of goods and develop export based economies. Over the last decade, these countries have rapidly increased their exports and have commanded a growing presence in the world market place (O’Neill 2007).
In addition to their comparatively youthful populations, each of the BRIC nations has abundant resources. Brazil and Russia both have capitalized on raw materials and natural resources produced from their land, while India and China have developed an extensive manufacturing network to produce mass produce goods to send into the global marketplace. Both aspects have geared the BRIC countries to lead the emerging economics in growth and GDP (Claymore 2009).
Over the past decade, burgeoning surpluses in international trade, large reserves in foreign currency, and increases in consumption, both global and domestic, have strengthened the economic similarities of Brazil, Russia, India, and China. Although the BRIC nations are far from identical, the similarity in their economies is incredible. Unique Characteristics
The term BRIC was not created simply to attach a catchy name for a group of countries with similar projected growth. The grouping was based upon significant analysis of common trends and parallels. Some of these parallels, as shown in Exhibit 1, have been summarized into five over-arching traits that Brazil, Russia, India, and China each display. [Exhibit 1 about here]
Over the past decade, BRIC nations have undergone more extensive economic development than the other emerging economies of the world. However, the result of this rapid growth has been both positive and negative. Generally, the...