Collect the jaguar, bear, tiger and panda together, and you'll see a good show, but is unlikely to get a quiet life.
Acronym BRIC (Brazil, Russia, India and China) has become the symbol of emerging markets to strengthen the global economy. After a successful decade for the BRIC countries swept crisis, from which they quickly left.
Goldman Sachs, the financial group, which introduced the category of countries, believes that China may become the largest economy in the world until 2030. Taken together, the BRICs economies until 2032 will surpass the level of production of Group of Seven, which prevailed in the management of the global economy.
BRIC countries already have a large share in world trade than the United States. China, probably the world's largest exporter of goods last year, was supported by the unproductive services, India, Russia's oil and gas, leadership in agricultural commodity markets, the Brazilian super-competitive farmers.
Although the stock shares in the G7 countries are struggling to stay on a positive level during the past approximately 5 years, the BRIC stock prices, although with a steep or day and the sharp rebound during the global financial crisis, ended the decade rate 2 times higher than in 2005. BRIC equity index rose; Fund is open to investors in order to become the sector.
The world comes out of recession, is moving there in this transformational time the center of gravity in the global economy and its governance? Is this a turning point, as the Second World War, when the U.S. became stronger and confident, the economy of Europe emerged from the war with a high debt load, and the world is changing the global financial architecture? And, most importantly: Do participants ORDERS BRIC to rebalancing the world economy by getting rid of consuming the American model?
The most likely thing: There is not. BRIC countries is also fragmented and almost any co-operation is very problematic, but China, which is the dominant member of the Quartet, it still seems devoted to export economic model, in which it is dependent on other countries.
"So-called emerging economies, even in Bangladesh, are the players on the world stage," - said Jean-Pierre Lehmann (Jean-Pierre Lehmann), Professor of Political Economy from the School of Management, IMD in Lausanne, Switzerland. "I do not see any major upheavals in the next 10 years, as well as the fact that the financial center of gravity is definitely shifting to the east."
Pododno boys band or a street gang, the BRICs, most likely, was selected based on their different capabilities, rather than similarities. The size of China and its openness to global trade making it the economic power comparable to all other members of the group. Marcus Jager (Markus Ja"ger) from Deutsche Bank calls giperkonkurentosposobnogo industrial products "vosmisotfuntovoy panda in the house. India, similar to the population, but poorer and more economically closed, mostly more useful for investors and partners in their programs and business services. Brazil, despite the small number of producers, remains one of the largest in the world agroeksporterov; Russia after a weak attempt to diversify, in fact, only sells oil and gas.
The history of their rapid development is familiar to all, but still interesting. Ten years ago, only one of these countries had a credit rating, but now it is all four. Only 12 years ago, a default in Russia and the Brazilian currency crisis rocked the world economy, and today they have accumulated massive foreign exchange reserves.
At the BRICs account for about half of global growth between 2000 and 2008, growth was much higher than in the previous decade. But with this growth, came to unbalance the world economy.
The Chinese model of growth based on large-scale investment and exports, was accompanied by a huge positive current account balance across East Asia, coinciding with the U.S. current account deficit. And despite making its contribution to the maintenance of economic growth during the crisis is far from clear that the Middle Kingdom has changed its attitude to consumer demand, which could become a true engine of global growth.
A large scale Beijing in November 2008 announced a package of incentives at $ 585 billion and to ease credit conditions. But China's ability to create self-sustaining growth was in doubt. Rather than distribute the money in hand to increase consumer spending, and perhaps, encouraging imports, a large piece of the stimulus went into the long-loved fixed assets. "If global demand will not recover in time, or incentives not to cheer people, China risks eventually create excess capacity," - said Jager.
Razin, Sally (Razeen Sally), trade expert from the London School of Economics said: "The Chinese intervention exacerbated the existing problems and imbalances. We see a lot of excess capacity in export-oriented industries, such as an excess of steel.
Re-peg the renminbi to the dollar in 2008, after he was allowed to go up, also not helped the Chinese economy to move from exports to domestic demand. The effect of this decision is multiplied copied the actions of many underdeveloped countries, suppressing its currency so as not to lose competitiveness to China.
Indeed, despite the widespread decline in consumer demand considerably reducing the absolute level of current account surpluses in China during the crisis, which reduced the number of vessels carrying toys and players from the Shenzhen and Shanghai, China continues building up its stake abroad. IMF and others believe that the apparent change in the global balance of the world economy over the last year of a temporary nature. When demand rises, so did the exports of China, with all the old surpluses and deficits.
Despite the extravagance, Chinese consumer sector has become smaller over the last decade. The overall level of savings grew throughout the decade. Although much of this growth reflects corporate savings - savings of households also increased, but still, a large share of national income went to the company, not consumers.
Last year's study of McKinsey Global Institute has supported the view that many economists have long discussed: shortcomings in the system of social guarantees - one of the main reasons why Chinese households save. The most obvious three reasons: educational needs, safety in case of illness and care for their parents. Changes in these deep structural factors will never be fast. But this is not resolved by a simple show of appreciation of the yuan.
As for the other BRIC countries, whose growth trends are slower, they are unlikely to have a significant impact on global demand for some time. Although the economy of Brazil and India have grown even in times of crisis, the past of these economies suggests that they do not maintain high growth rates. India also faces the chronic problem of public funding, and savings rate for households is even higher than in China. Meanwhile Russia, whose economy has declined sharply during the global slowdown continues to depend on oil prices.
Ten years of economic growth is not enough to BRIC to grab the baton of global economic leadership by the United States and Western Europe. Group, or some of them might surprise the world with their progress over the next ten years. However, this will require qualitative improvements, as well as greater support for these changes by the authorities.
The Financial Times
January 17
January 17
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