Background
The BRIC nations include a set of four big states, namely Brazil, Russia, India, and China, which are emerging. These states are differentiated from a collection of new upcoming and promising markets through their fiscal and demographic potentials. Such potentials could be used to rank the BRIC states amongst the most influential and largest global economies in the current twenty-first century. China, India, Russia, and Brazil, which constitute the original BRIC nations jointly contain over forty percent of the total world populace, produce over 25% of the global gross domestic product and occupy in excess of one-quarter of the total terrain covered by 3 continents.
The BRIC nations are responsible for a larger portion of services and commodities that are globally consumed. Since the BRIC states are reported to trade intensely with each other and are amongst the best economic performers, they have drawn the attention of economic experts and researchers. This paper highlights facts about the BRIC states economy. It also underlines the reasons why China, India, Russia, and Brazil’s economies are relevant to the global economy.
The BRIC state’s economy
Analysis of the situation
The demography and all inhabitants of the BRIC states clearly illustrate their abilities and prospective economic dimensions to operate as worldwide fiscal engines for advancement and economic growth. Amid the fiscal year 2008 and 2000, the overall international economic production for the BRIC states only improved to 22.0% from 16.0%. China, India, Russia, and Brazil jointly produced thirty percent of the worldwide production expansion throughout these fiscal stages (Ardichvili et al., 2012). The velocity and range at which China’s economy develops have evidently outpaced those of Brazil, Russia, and India. Besides, out of the entire worldwide economic production documented from 2008 downward to fiscal 2000, the country of China solitarily produced over fifteen percent of the total output. This implied that China produced over half of the whole shares supplied by all BRIC nations.
The main growth indicators table beneath illustrates the gross domestic output or product, commodities exported, state inhabitants, and the individual development file for China, India, Russia, and Brazil. The demographics and rapid growth of India and China have led to the expansion of the middle class. The consumption of this faction has helped in enhancing the global economic expansion and the economic development of BRIC (Wilson & Purushothaman, 2003). The BRIC countries also invest a lot in technology and scientific research.
Reasons why China, India, Russia and Brazil are considered important
BRIC states as the steering for new growth and development
The BRIC nations have attracted a lot of academic and media attention in the modern time. China, India, Russia and Brazil appear to be totally different from other countries since they have variations in their economic structures, languages, backgrounds and cultures. Nevertheless, the BRIC countries possess a universal denominator. The shared denominator is that the economic development and maturity of China, India, Russia and Brazil have surpassed the growth and development recorded by the leading global developed countries. Even subsequent to experiencing the 2007 to 2009 financial depression, the BRIC states consistently outperformed other international economies. For instance, whereas large economies of developed countries such as Germany and Japan shrunk to the height of 6.0% in the fiscal 2009, China recorded an economic growth of 8.10%, India had an economic growth of 5.90%, Brazil remained steady and merely Russia recorded poor economic growth rate of 7.0% (Ardichvili et al., 2012).
All the 2010 and 2009 economic growth and development forecasts which gave the BRIC states the unanticipated economic growth beyond the typical industrialized nations have further drawn the attention of most economies. The forecasts also increased various countries trade interests in China, India, Russia and Brazil. When we look at the fiscal 2009 real gross domestic product in US dollars as provisionally forecasted by World Bank in 2005, it is clear and interesting that amongst the top ten global largest economies Brazil was ranked number ten. Moreover, China was ranked third, India eleventh and Russian thirteenth. When the economies of BRIC states are combined they are equal to 50.0% of the universally largest economy-the United States economy. If the BRIC states markets and wealth are pooled together they outdo that of the second universal prime economy of Japan (Scott-Kennel & Salmi, 2008).
The BRIC states are of great importance to other states because their financially viabilities as well as industry and trade figures are totally different from those which were reported thirteen years back. For instance, in the financial year 1999 the economy of China was globally ranked seventh, India was sixteenth and Russian was fifteenth. Brazil was reportedly ranked the tenth international largest economy. When compared with the economy of America the total sum of the BRIC economies in 1999 represented thirty percent of the United States. In the past ten years the economy of India grew by 92.0%, Russian improved by 69.0% and Brazil grew by 36.0% but the economy of the United States only improved by 20.0% (Muller, 2011). When compared with twelve years ago China is now 2.5 times better-off than other developed countries.
It is anticipated that when that trend continues in the next few years China, India, Russia and Brazil will probably occupy the largest top ten world economies spots. The BRIC countries will occupy these spots at the expense of Spain and Canada. In the financial year 2009 it was estimated that the BRIC states produced 60.0% of the total global economic growth. Japan which was the second largest global economy was overtaken by China in the second quarter of the fiscal 2010. During that same period Russia and Brazil reported positive economic growth rates while India kept showing healthy economic growth and development. Therefore, the BRIC states are relevant to the entire worldwide economies (Muller, 2011).
Trade dealings within the BRIC nations
There are numerous opportunities and trade advantages offered by BRIC states to the rest of the world and other BRIC peers. Out of all BRIC countries China appears to be the largest state but this does not necessarily bar India, Russia and Brazil from being members of that group. In fact, the improved trade dynamics that occur between the BRIC states have attracted the attention of business practitioners and experts. While Brazil is considered the main supply partner to both India and Russia, China follows its suit as the second supplier (Hill, 2011). China is a substantial client to Brazil and it represents the third largest Brazil market. India and Russia consider China as their fourth and sixth markets.
When India, Russia and Brazil are observed individually none of them can be considered important from the perspective of China. As a group however these countries are the major trade associates to China ahead of Japan since they jointly supply over 18.0% of the total China’s imports. Other than the enhanced trade dealings between the BRIC countries the heads of Brazil, China, India and Russia began talks to ensure that an influential block is created to alter power and supremacy balance with Europe and the United States. The BRIC countries leaders argue that institutions like World Bank and IMF have underrepresented the BRIC states economic importance (Behrman, 2006). It is not very clear whether the BRIC nations will manage to reverse the current balance of power. Nonetheless, as the interactions amid BRIC states increase the importance of China, India, Russia and Brazil to other developing and industrialized nations increases. Thus, the BRIC states have advanced to be a well known and active block of four different countries.
Conclusion
From numerical economic facts, the BRIC states are at present the prime and top upcoming as well as advancing international marketplace economies. These states produce a significant portion of the total international gross domestic product growth rate. They produce approximately 2.80 billion of the total worldwide inhabitants. Besides, the BRIC states are projected to be amongst the top ten international biggest economies between the fiscal 2050 and 2020. China will be the prime international creditor and the acknowledged financially viable economy. The BRIC nations continuously work together and will probably set up a new economic future that will absorb and direct the whole world. Since they are dominating key economic sectors such as the supply of raw materials, services, manufactured goods, global trade and offer ready markets for merchandises, they are very relevant to the world economy.
References
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Behrman, J. N. (2006). Peaks and pits with the BRICs: Accommodation with the West in emerging economies and the transformation business, Brazil, Russia, India and China. Cheltenham: Edward Elgar.
Hill, C. (2011). International business: Competing in the global marketplace. New York, NY: Irwin/McGraw-Hill.
Muller, M. (2011). New kids on the block: The rise of the BRIC and the reconfiguration of global economic ties. European Researcher, 12(5), 1615-1625.
Scott-Kennel, J. & Salmi, A. (2008). The rise of the big emerging markets of Brazil, Russia, India, and China: Implications for international business teaching in the next decade. Journal of Teaching in International Business, 19(2), 142-166.
Wilson, D. & Purushothaman, R. (2003). Dreaming with BRICs: The path to 2050. Goldman Sachs Global Economics Paper. Web.