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Bric

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Submitted By aliya
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BRIC is an acronym standing for Brazil, Russia, India and China. Although can be categorized by importance of countries, it would be CIRB which is China, India, Russia and Brazil. The BRIC are both the fastest growing and largest emerging markets economies. These four countries encompass more than quarter of the world’s land area and in 2009 accounted for more than 40% of world’s population, 40% of the world’s foreign exchange reserves and 25% of world’s GDP.
The states, which were earlier, accepted to consider as developing countries of Third world, promptly become economic giants of the new world. BRIC: Brazil, Russia, India and China – four markets everyone with the unique features, but thus unites them the potential generated by changes in political systems of these countries. As a result of these changes there was a consumer demand, which is formed by 43% of the population of the whole world. In roughly developing countries of BRIC there are five of the ten largest cities of planet where concentrated the huge amount of capital and millions of consumers who are aspiring up on social and economic ladder.
The term BRIC was included into a business lexicon in 2003 after the economist of Goldman Sachs investment bank Jim O'Neill described future economic picture of the world. In his opinion, by 2050 the economic capacity of these four countries will allow them to become dominating economies, and to surpass in scales not only economy of the USA, but also economy of all of the countries of Western Europe taken together. However, on forecasts of experts of Goldman Sachs, it can happen and earlier - not through forty, and in twenty years.
It should be noted that the sequence of capital letters in an abbreviation is important only for its harmony. So, at Brazil the smallest gross domestic product from all "four", and at China, on the contrary, - the biggest. In 2010 China, according to the information, had overtaken Germany, on this indicator conceded only to the USA and Japan.
Before financial and economic crisis growth of gross domestic product of these states reached from 5 to 13 percent a year - for industrially developed national economy of the world size in recent years unattainable. Members BRIC are characterized as most quickly developing large countries. The advantageous position to these countries provides existence in them a large number of important resources for world economy:
− Brazil - is rich with agricultural production
− Russia - the world's largest exporter of mineral resources
− India - cheap intellectual resources
− China - the owner of a cheap manpower
These are the main resources on which economy of these countries leans. High population of the countries causes low cost of work in them and, respectively high rates of economic growth.
The thesis BRIC assumed that Brazil, Russia, India and China changed the political systems to capture global capitalism. Goldman Sachs foretold that China and India would be dominating global suppliers of the goods of industrial function and services while Brazil and Russia became also dominating suppliers of raw materials. Cooperation was, thus, probable - as logic step BRIC because Brazil and Russia together logically formed suppliers of India and China. Thus, at BRIC there was a potential to create the strong economic block - like the "G8" states. Brazil is a soya dominating in production and iron ore while Russia has huge supply of oil and natural gas. The thesis, thus, documented Goldman Sachs that consumer goods, work, technologies and the companies keep away from the USA as from the center.
The global economic team Goldman Sachs issued the report on research BRIC in 2004. The report argued that in the countries BRIC the number of people with a revenue more than $3 000 would double within three years and would reach 800 million people within a decade. It predicted massive increase in middle class in these countries. To 2025 it is calculated that number of people in the countries BRIC earning more than $15 000, can pass for 200 million. It means that huge loading in demand won't be limited only to the main goods, but also will affect more expensive goods. According to the report, at first China, and a decade later and India will start to dominate over world economy. Goldman Sachs estimated that to the 2025th income on person in six most densely populated EU countries will exceed $35 000 whereas only approximately 24 million people in BRIC would have similar levels of the income.
Economic activity of the countries of participants BRIC already made a certain impact on world economy and economy in these countries. This influence can be both negative, and positive. Positive sides of existence BRIC generally can be considered from the point of view of impact on economy of the country.
Positive influence of activity BRIC can be considered from 2 positions:
1. from a position of influence on internal processes of the country entering in BRICK;
2. from a position of influence on world economy.
So BRIC it was possible to carry to positive sides of activity:
1. Increase of investment appeal of the countries BRIC.
So the countries BRIC gradually ceased to be perceived only as a source of cheap labor and natural resources: the research PricewaterhouseCoopers testified that heads of the largest world companies look at BRIC countries (Brazil, Russia, India and China) it was rather as on the largest new sales market. The majority of them thought of developing work in these countries though almost all recognized that globalization conducts to negative complication of business and emergence of new risks.
2. Industrial growth in the countries participants BRIC.
Industrial growth in China and India supports demand for metal and oil. Therefore developing countries yet shouldn't be afraid of falling of quotations at the raw exchanges.
3. Growth of level of the income in the countries BRIC.
Inflow to the countries of money from raw export stimulated growth of welfare of the population. Generally owing to activity of the countries BRIC the income of separate groups of people, owners of the large highly remunerative enterprises will increase.
4. Stimulation of development of world economy.
The exit to the world market of the large enterprises from the countries BRIC promoted competition growth among producers that positively affected development of world economy.
5. Improvement of demographic situation countries BRIC.
BRIC inevitably led growth of the income of the population of the countries to improvement of a standard of living and respectively to increase of birth rate and life expectancy of the population.
6. Increase of level of stability of currency of the countries BRIC.
The countries BRIC, also became richer with a way of increase of cost of currency. Currencies tend to rise, as more high efficiency leads economy to rapprochement of level of parity of purchasing power (PPP) with level of an exchange rate. The accurate tendency that the countries with high level of the income per capita establish the exchange rate approached to PPP is looked through. In all countries BRIC the exchange rate is established much below, than accepted according to PPP.
In process of development of economy growth rates decreased, and the exchange rate of currencies rises. Both growing currencies, and rapid economic growth together gradually increased dollar gross domestic product per capita, and distinctions between the countries BRIC and the developed world slowly are erased.
7. Increase of level of political stability of the countries BRIC,
During some subsequent decades each of the countries BRIC will meet various difficulties of political transformations. For some countries (especially for Russia) institutional transformations are the most important in acceleration of economic growth.
If existence of BRIC renders positive influence generally on the countries that included in BRIC, negative sides of this phenomenon can be referred to world economy.
Negative consequences of activity of the countries of BRIC were considered as follows:
1. Economy globalization.
Some economists are considered economy globalization, as the negative phenomenon.
2. Regrouping of world currencies.
High growth rate can lead to increase in profitability of investments in these countries and to the increased demand for the capital. Specific weight BRIC in investment portfolios can sharply rise. The capital in their party could expire so many that it will lead to a regrouping of the main currencies.
3. Possibility of emergence of instability of world economy
Shift of balance of participation of the countries in world economy would result in possible instability. So in nowadays developed countries in the future there could be the new economic crises connected with redistribution of the world capital.
Despite all revealed negative sides positive sides of economic development of the above-named countries block all minuses.
Thus, today the most perspective countries for business, according to many analysts, are Brazil, Russia, India and China, or as they are called often by the countries BRIC. http://www.globalsherpa.org/bric-countries-brics http://www.economist.com/node/15912964 http://web.ebscohost.com/ehost/detail?vid=20&hid=110&sid=9d053231-d17f-462e-8794-798867f149f1%40sessionmgr15&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&AN=72444994 http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=4&hid=14&sid=38f01e45-39e5-46b4-b71e-c63eef23d329@sessionmgr104

South Africa
South Africa, which is officially the Republic of South Africa, is a country that located at the southern tip of the continent of Africa. It is divided into 9 provinces, with the total area of 1,219,090 square kilometers. South Africa’s neighboring countries are Botswana, Namibia, Zimbabwe and Mozambique. The coastline length is 2,798 square kilometers on the Atlantic and Indian oceans. It is multi-ethnic group country were 79% of black African, 9.7% of white, 8.9% of colored and 2.5% of Indian/Asian people live. The whole population of the country is 48,810,427 people; South Africa takes 26th place comparing with other countries’ population. Population growth rate is – 0.412% (2012), age structure 0-14 years 28.5%, 15-64 years – 65.8%, 65 years and over 5.7%. Birth rate is 19.32 births/1,000 population, death rate is 17.23 death/ 1,000 population. (2012). Life expectancy at birth: total population is 49.41 years where male - 50.34 and female – 48.45 years (2012).
South Africa is a middle-income country; its market makes a big supply of natural resources. It has good political equality, economic stability, well-developed energy, legal and many other sectors. South Africa also has stock exchange market, which counted as world’s 18th largest markets. As for natural resources, this country has almost all essential commodities, except petroleum products. It is the only country that manufactures fuel from coal. GDP fell down nearly 2% in 2009 and recovered in 2010-2011 years, and was 3.4% in 2011. GDP composition by sector: agriculture (corn, wheat, sugarcane, fruits, vegetables; beef, poultry, mutton, wool, diary products) was 2.5%, industry (mining, machinery, iron and steel, chemicals) was 31.6% and services were 65.9% during year 2011.
South Africa is a multi-party parliamentary democracy in which constitutional power is shared between the president and the parliament. Where parliament consists of two houses, which are National Assembly and the National Council of Provinces, which are responsible for drafting the laws of the republic.
The current president of South Africa is Jacob Zuma, who has worked hard in order to be regarded as a member of BRIC countries grouping and his efforts proved in December 2011. China that one of the countries of BRIC, invited South Africa with its largest economy of Africa to join the four members BRIC group. China was the strongest companion of South Africa and its largest partner in trading. China had made a great impact on Africa, and trade already amounted at $ 115 billion at the end of November 2011.

http://web.ebscohost.com/ehost/detail?vid=31&hid=104&sid=9d053231-d17f-462e-8794-798867f149f1%40sessionmgr15&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&AN=73528142 https://www.cia.gov/library/publications/the-world-factbook/geos/sf.html BRICS today
South Africa joined BRIC group in 2011 and after that this group of four became BRICS club. According to information of the World Bank, it takes 31st place of world’s largest economies, but the amount of Gross Domestic Product is equal to one quarter ($357 billion) of Russia’s economy, which is $1,45 trillion and one sixteenth of China’s output. “We will be a good gateway for the BRIC countries. While we may have a small population, we don’t speak for South Africa, we speak for Africa as a whole,” said Soth Africa’s Minister of International Relations and Cooperation Maite Nkoana-Mashabane. Of course, South Africa plays very important role for these four developing countries, because South Africa is the world’s 4th largest producer of gold and diamonds and also has more than three quarters of the global platinum reserves.
South Africa has a business alliance with Russia. It is also good economy with developed capital markets, which is place to the very important platform to purchase publicly listed assets in Africa, because almost 90% of portfolio investment in continent goes through 18th largest Stock Exchange, which is situated in Johannesburg. India and China see more perspectives in joining South Africa as it gives services such as telecommunication and mining sector. The membership with BRICS gives to South Africa a great opportunity to access to the big amount of capital and know-how in exchange to access to the economy of Africa to the rest of the continent and extensive number of minerals.
There were already two summits held before joining South Africa Republic; first summit took place in Yekaterinburg, Russia in 2009. The main issues of this summit were global financial crisis, global development and strengthening the BRIC group. The second summit was in Brasilia, Brazil in 2010, where the main issue was Iran and nuclear weapons. The third summit took place in Sanya, China in 2011; at that time the group was already named BRICS, leaders of the countries raised economic questions. The last summit was held in New Delhi, India in March 2012, the agenda of this summit was to create a new development bank. http://english.cntv.cn/20120329/107938.shtml
The members of BRICS already achieved results in agreement on reforming the World Bank and International Monetary Fund and reinforcement of global authority. Those members also pay attention to coordinate its approaches in implementation the Global Counter – Terrorism Strategy.
In March 2012 members of BRICS countries signed a deal on provision of loans in national currencies of the countries and multilateral agreement on confirmation of letters of credit. http://web.ebscohost.com/ehost/detail?vid=25&hid=7&sid=9d053231-d17f-462e-8794-798867f149f1%40sessionmgr15&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bwh&AN=73939283 http://web.ebscohost.com/ehost/detail?vid=20&hid=125&sid=9d053231-d17f-462e-8794-798867f149f1%40sessionmgr15&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&AN=62560682

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