OUR FOCUS

Assess some of the BRICs in terms of

their emerging economy status.
Understand some recent changes to
the worlds BRICS
Identify some concepts and
complexities about BRICS
HDI 0.69 0.94 0.79 0.55 0.63 0.73
GDP per 9,200 49,900 23,500 3,900 4,900 11,900
capita US$
PPP
Internet users 40 78 48 11 22 46
(% pop)
GDP from 10 1 4 17 38 6
agriculture
(%)
Population 0.5 0.9 -0.1 1.3 1.0 0.8
growth rate
(%)
(2012 data) China USA Russia India Indonesia Brazil

Powerful countries:
whos who?
 Comprehensive National
Power (CNP), Chinese
Government
Score 2007 Score 2014

USA 91 USA 100

UK 65 China 75
Russia 63 Russia 60
France 62 France 35

Germany 62 Germany 35

China 59 Japan 30
Japan 58 UK 25
Canada 57 India 25
S Korea 53 Brazil 20
India 50 Turkey 20

Two different ranking systems

Both attempt to quantify hard (military) & soft (economic, cultural)
power
The CNP has changed hugely since 2007
European countries have lost out; China, India and Brazil have moved
up
3 countries (USA, China, Russia) have pulled away from the rest
 Why BRICSs?
BRICs coined in 2001, by Jim
BRIC G7
ONeill at Goldman Sachs bank
140,000
The argument by 2050, the
120,000
BRICs would exceed the
100,000
economic power of the G7
80,000
Post-global recession suggests
Combined GDP $ billions 60,000
the crossing point will
40,000
happen sooner rather than later
(2030/35?) 20,000

0
What began as an economic
idea, is now an official reality;
the first BRIC summit held in (2010, Goldman Sachs)
2009.
In 2010, South Africa joined the
group i.e. BRICSs not BRICs!
 Do BRICS make any sense?
100%

BRICS GDP totalled $US$16.039 90%

trillion in 2012
80%
Compares with $17 trillion for
EU & $16 trillion for the USA 70%
China
60% South
Africa
50% India
China alone accounts for 55% of Russi
BRICS GDP and 49% of their 40% a
Brazil
military spending
Take China out of the BRICS, and 30% Between 2000-
the BRIS look much less powerful 20%
2012, China
overtook the UKs
10% economy rising
from 6th to 2nd
0%
largest (UK
dropped from 4th
to 6th)
 Barriers to BRICS
Russia Sluggish global recovery dents
Russias oil and gas exports
(fossil fuels are 45% of all
exports). Dependent upon
Ukraine for gas exports

India Economic reforms. Red

Tapism, there is so much talk
about make in indiabut still
not that investment friendly

China Correction of currency; fears

of a massive property credit
bubble (Robert Peston 2014)

Brazil Lack of investment, high cost

of World Cup and Olympics,
populist government
handouts e.g. pensions.
Protest movement growing.
 Important regional power, its economy
dominates South America
At 198 million people, Brazil contains half the
population of the continent (385 million)
Spends more on its military than the rest of
South America combined

South American military

Brazil spending, 2012
Colombia
Argentina
Venezuela 6% 4%
Peru 6%
Uruguay
22% 61%
Bolivia
Paraguay
Brazils trump card is its natural
resources, making it more than self-
sufficient in food and energy production:
More potential agricultural land (400
million hectares) than any other country
on earth
An agricultural superpower in terms of
exports (graph)
Worlds second largest bio fuel
producer, after the USA
15th largest oil reserves (likely to rise as
more deep water oil is discovered)
3rd largest producer of iron ore
3rd largest producer of HEP

Brazils oil fields are only just

being developed (3 to 4 years)
 BRAZIL v/s
INDIA
Brazils natural
resource strength is
seen by comparing
net imports of Brazil
and India (right)

Indias net imports

are dominated by
crude oil, minerals
and even food and
wood

Brazil is more self-

sufficient in basic
resources and
imports more
chemicals, plastics,
electrical and
 Hindrance to Brazil
Economy
Brazil has recently stalled, relying too
much on raw material exports
Its middle class is growing, but less
strongly than 5 years ago
Protests in 2013 against higher public
transport prices did not help rebellions
against 2014 World Cup & 2016 Rio
Olympics
These protests were really about a lack FIFA World
of decent public services for a growing Cup 2014 Rio Olympic
middle class, compared to corruption
and Paralympics
and spending on global sport
Games 2016
Long term, Brazils natural resources are
likely to prove very valuable
The Olympics and World Cup are being
used to shine on the world stage but
can Rio deliver?
The 4 Asian Tigers Nominal GDP Other Nominal GDP pc
pc 2010 countries 2010 (US$)
(US$)
Singapore 43,117 Chile 11,827

Hong Kong 31,514 Brazil 10,816

South Korea 20,756 Turkey 10,309

Taiwan 18,558 Malaysia 8,423

GDP of many other Asian Tigers Thailand 4,992

exceeds most EU A8 countries.
Hong Kongs GDP is close to the China 4,382
EU average of $32,500. Indonesia 2,974

Philippines 2,123
 Why so special treatment to China?
China became globally significant when its GDP passed
5% of global total in 2005; now heading for 10%
That level of global GDP gives it huge economic
influence
 USA V/S China
Economic Per capita GDP in China is still only 1/10th of that in
the USA
The US attracts a constant stream of high skill
migrants from all over the world; China still
relatively isolated
Universities with global reputations e.g. MIT,
Stanford, Harvard.
China tends to copy, rather than innovate.
Cultural
China has few (if any, Lenovo? China Mobile?)
global brands
The USA dominates the global entertainment
industry
Military
China is a long way off in terms of global military
reach
Internatio The USA is still the nation the world turns to in a
nal crisis, such as a major natural disaster
China does seem to shun international involvement
and has yet to get people behind it.
 Chinas new aircraft carrier its
only carrier entered service in
Sept 2012 and they planning to
launch one in 2016
The Liaoning is actually the ex-
Soviet Varyag launched in 1988.
The USA has 11, with 3 more under Carriers Operating Building

construction USA 11 3
Chinas long term military plans are
Italy 2
to be able to defend out to the
UK 1 2
Second Island Chain. Meanwhile (helicopter)
Obamas Pivot is shifting forces to India 1 2
the Pacific.
China 1 3

France 1

Spain 1

Russia 1
 China goes Global
There is no doubt that China is
expanding
Its state-run companies and
banks, as well as its Sovereign
Wealth Funds (worth about $1.2
trillion in 2012) are all investing
overseas
As the diagram shows, this is
global - it is not confined to 1 or
2 regions
Its 2005-13 overseas investment
was about the same size as the
entire Swiss economy.
China also owns $1.3 trillion of
US government debt (as does
Japan)
State led InvestmentChin
Sales
Fortune 500 (US$
a global rank billion)
Rank 2012

1 17 Sinopec (oil) 131

Chinas FDI is different to that of
many countries, as companies are China National
often state-run enterprises 2 24 Petroleum 110
40% of all profits in China are made State Grid
by state run companies 3 29 Corporation 107
State involvement makes some
Industrial &
governments nervous e.g. some 4 170 Commercial Bank 36
private companies like telecom
5 180 China Mobile Limited 35
company Huawei
Huaweis apparent closeness to the 6 192 China Life Insurance 33
Chinese government has been
7 215 Bank of China 30
dubbed a national security
China Construction
threat by Donald Trump 8 230 Bank 28
presidential candidate(2016).
Many Chinese companies are China Southern Power
9 237 Grid 27
publicly traded (table) but still
influenced by government 10 275 China Telecom 24

State owned companies in red

Neo-colonialism in
africa
Chinas investment in Africa is rising
About 1 million Chinese now live there
Chinese trade with Africa now worth
US$200 billion per year
80% of Chinese imports from Africa are
minerals (incl. oil) (see chart
Other BRICs increasing their trade with
Africa (see lower graph) usually focused
on natural resources
China is sensitive to charges of neo-
colonialism; "China has built over 100
schools, 30 hospitals, 30 anti-malaria
centres & 20 agricultural technology
demonstration centres in Africa. China
has trained .. 40,000 African personnel ...
and provided over 20,000 government
scholarships" (Hu Jintao 2012)
 As a good Indian
first will discuss Indias problems
3% of GDP is spent on
subsidies for the poor
fertilizers, fuel, food which
is hugely expensive when
the costs of importing these
rises.
Inflation, the
Red tape and falling value of
corruption are the Rupee, large
major government
problems, as budget deficits
are lack of India? all make
power, water financial
and transport markets
infrastructure nervous
20% live in poverty, & few jobs for
the poor manufacturing peaked
at 17% of the economy in 1995,
now only 14% ; middle class IT /
outsourcing jobs do not benefit the
worst off.
 MAKE IN INDIA
According to data on the Indian
government's DIPP website, the total FDI
investments India received in January-
June period of 2015 was $19.4 billion
and in the whole of 2014, the country
received$28.8 billion. In 2013, India
received$22 billionFDI and$22.8
billionin 2012.
 INDIAS Energy Crisis
India has increased generating capacity recently but is a long
way behind China.
Imports of fossil fuels are rising rapidly as the rupee weakens.
Most analysts think India is several decades away from having a
sufficient and reliable electricity supply

Although growing, India has large coal Oil imports are rising
electricity generation reserves, but cannot rapidly with costs
capacity is tiny supply demand from rising too as the Rupee
compared to China, domestic supply remains weak
 To Conclude India
Strengths Weaknesses
The least
Education Infrastructure developed
English Energy and water overall of the
language supply BRICs, with
Youthful Poverty huge rural
population Weak inward poverty, but
IT and investment also huge
Software potential
Opportunities Threats
Huge domestic Tensions within
market southern Asian region
Vast growth e.g. Pakistan
potential Resource / food crises
Urbanisation Red tape/ bureaucracy
BRICS own World BAnk
Global Integration of BRICS

Trade Integration
Bilateral trade and investment accords between the key
members of the grouping
Continental/regional trade integration facilitated by
BRICS institutions
Trans-continental trade/investment integration
Alliances with other continental and transcontinental
integration groups
Global integration initiatives
Dealing with protectionism in trans-border investment
flows
Greater accountability and transparency in the formation
of RTAs
http://valdaiclub.com
 BRICS Share of Global
Export
According to statistics of the World Trade Organization
(WTO), the participation of BRICS in global exports
more than doubled between 2001 and 2011, from 8%
to 16%.
BRICS total exports have grown more than 500%, while
total global exports grew 195% in the same period
Between 2002 and 2012, intra-BRICS trade increased
922%, from US$ 27 to 276 billion, while between 2010-
2012
BRICS international trade rose 29%, from US$ 4.7 to
6.1 trillion dollars

http://brics.itamaraty.gov.br/about-
brics/economic-data
BRICS Inflation

http://www.business-
standard.com/article/economy-
policy/india-s-fundamentals-best-
BRICS Trade Profile
BRICS Global remittance and FDI
Inflow

http://www.worldbank.org/content/
dam/Worldbank/GEP/GEP2016a/Glo
bal-Economic-Prospects-January-
Stock market performance of BRICS

https://www.msci.com/resources/fa
ctsheets/index_fact_sheet/msci-
bric-index.pdf
Sector wise Performance of
BRICS
 Global Financial Crisis in
BRICS
The financial meltdown of October 2008 sent stock markets
in BRIC economies tumbling as foreign investors fled. The
notion that emerging economies were decoupled from the
crisis in the developed world has proved wrong
Growing consumer spending in BRIC countries will help
them to withstand the crisis. While the pace of growth is
excepted to slow, BRIC will remain a huge and growing
consumer market
The crisis is expected to remove the danger of inflation
making life easier for BRIC consumers and allowing
governments to ease interest rates, fuelling further growth
However, unlike other emerging economies, BRIC have large
trade surpluses and foreign exchange reserves that make
them more resilient to the crisis.
 Acknowledgement
Goldman Sachs Yearly Report 2015
CitiGroup articles on BRICS
Superpower.com
MIT Lincoln online library
NDB official Website
Wikipedia
If you note any images which are wrongly cited, please contact
the Geographical Association (www.geography.org.uk)
Every attempt has been made to cite the source of each image
where appropriate
Development data are from the CIA Factbook, which is
continually updated. Some data may therefore now vary from
those cited at the time of this Presentation.