November 28th, 2011
01:13 AM GMT
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(CNN) – With the eurozone debt crisis in full swing and a Super Committee on Capitol Hill that admitted at least temporary defeat, one could be caught flat-footed and miss a milestone anniversary.

A decade ago, November 30 to be precise, the long serving international economist Jim O’Neill in a paper outlined his research on the power of the “Big Four” of the emerging world, Brazil, Russia, India and China.  In his piece, “Building Better Global Economic BRICs,” O’Neill marked a turning point in economic thinking that future growth will be driven by these large emerging markets.

O’Neill boldly stated back then that the BRIC economies will surpass the G7 economies of the industrialized world by 2027 and most of his peers have lined up behind that strategy in agreement.  In 2008, most strategists believe the western led financial crisis marked the quick transformation from the G7 to the G20 context, no less than an official recognition of O’Neill’s work.

The BRIC countries sit on $4.5 trillion of foreign reserves; add in the Middle East sovereign funds and their reserves and those tally up to nearly $6 trillion.  That could explain the quick embrace by leaders during the heat of the crisis.

We are finding out during this period of turbulence that growth does not come without challenges – most notably inflation and in India’s case downside currency pressures as well.   O’Neill believes it will be a constant juggling act between managing inflation and sustaining growth with so many pressures coming from the West.

During an interview on our program, Global Exchange, O’Neill said, “The key for these guys (BRIC economies) is to grow their domestic consumer to stop reliance on the West.”

For political reasons and with China’s support, the club has been expanded to include South Africa which is dwarfed in every category:  size of GDP, population, a high jobless rate and foreign direct investment, but many believed Africa needed to be represented.

O’Neill and his team at Goldman Sachs have defined the next frontier if you will with the Next 11 or N-11 – a disparate group of economies that they believe will offer fast growth, scale and youthful populations.  They may be garnering less media traction for this grouping, but countries such as Indonesia (the most populous Muslim country), Turkey (the bridge between East and West) and Mexico (America’s neighbor to the South) all have their own worthy stories to garner direct investment and the attention of fund managers the world over.

O’Neill pointed out that the BRIC plus N-11 represent nearly three-quarters of the world’s population and they are driving global consumption.

But it will be the BRIC countries that will carry sway economically and politically. They have held three annual summits, make calls for a multi-polar world and even put out their own communiqués at G-20 gatherings.

It boils down to their economic power, says O’Neill: “The increase in BRIC GDP this year will be close to creating another Italy.”  Italy is a $2 trillion economy, which says a lot about how fast the BRIC players are growing today and how far they have come in 10 years.



soundoff (21 Responses)
  1. Jose

    While these countries have been working hard building their economy brick-by-brick over the past decade, the U.P.I.G.S (US. Portugal, Italy, Greece & Spain) nations have been busy spending like crazy and building up their spiraling debts. What a contrast.

    November 28, 2011 at 2:09 am |
  2. Kshah

    I hope that China and India jointly act for their own interests rather than compete against one another, both sides shall gain. I can't wait to see what the world shall look like in 2020, everything shall have changed a lot. Exciting and depressing times coming up.

    November 28, 2011 at 5:01 am |
  3. Dibgy

    Do you think wages and prices in the Upiigs countries need to fall gradually to match the Brics etc ?

    November 28, 2011 at 5:39 am |
  4. Johnny wazhere

    The one should not overlook democracy. I think democracy in BRICS is not at the same level in other groups like EU. You can google death squad "B"razil or the current farce called elections in "R" ussia. Never ever underestimate the value of democracy when trying to reach an opinion this or that group.

    November 28, 2011 at 5:54 am |
  5. Guest

    The point of democracy doesnt applies to India,compared with many west countries India has a better democratic procedure,slow but still democratic.

    November 28, 2011 at 7:39 am |
  6. Johnny wazhere

    To prove my point here is what Mr.Fareed Zakaria has written "Zakaria: Why Russia is blacklisting Americans"
    >>>""The underlying issue here is that for all the glitter of having being named a BRIC – one of the hot emerging markets >>>- Russia remains a country where corruption is rampant. It ranks 154th in the world on Transparency International's >>>index – and powerful officials can commit crimes with impunity.""

    November 28, 2011 at 7:54 am |
  7. Fernando

    @Johnny wazhere: What's the point citing the Death Squad movie when you are talking about democracy in Brazil?? The movie shows a lot of corruption and drug traffic going on (things that also happen in many other democratic nations – US for instance).
    The only BRIC country one can point the finger to when it comes to lack of democracy obviously is China. Nevertheless this is the world's engine now, being as non-democratic as it is...
    FYI Brazil has been a pure democracy since 1990 – currently presenting one of the most transparent election process ever seen.

    November 28, 2011 at 7:54 am |
  8. Johnny wazhere

    Re: "Guest, The point of democracy doesnt applies to India,compared with many west countries India has a better democratic procedure,slow but still democratic.
    November 28, 2011 at 7:39 am | "
    Sir, the one cannot be happy about the mere presence of democracy. In the case of India, democracy is just an empty shell. Let's push the case further. Democracy's presence in any country ensures the fair distribution of wealth among the population. If you google "POVERTY in INDIA" you will understand what I mean. India needs to eradicate poverty to prove that it has democracy. Otherwise democracy would be just empty words that means nothing to the empty stomach.

    November 28, 2011 at 8:07 am |
  9. Andy

    @Johnny wazhere Sir,;) So you are saying that because some country has some poor people, that must mean that they must be non-democratic? Good logic.
    India is democratic by every known standard whether you like it or not.

    November 28, 2011 at 8:22 am |
  10. Justmyco2011

    @Johnny wazhere "Democracy's presence in any country ensures the fair distribution of wealth among the population." – I think you confused Democracy with Communism. It is the Communists who want everybody to be equally poor. Just for your information, Indians are much more politically active then most of the Countries that are democratic from your point of view. Yes, they might not be literate, but politically active – this is the uniqueness of India. Secondly, in India, political parties have been voted out and in through elections, which is the most prominent sign of Democracy. Yes, India has poverty and illiteracy and they might not have all the conveniences that make you think that it is a part of being a Democratic Country, but still it is not a empty shell. It looks that you are quite active on google, why don't you do some simple research over the Internet and get a better picture.

    November 28, 2011 at 8:51 am |
  11. puneet

    India is the world’s largest democracy . Now a days it holds election using electronic voting machines to ensure transparency, in the democratic elections. Indian politicians are corrupt, no doubt and democracy is traded for populist policies. However its a very thriving democracy, powerful parties get voted out of power like in case of state of Bihar(india) better parties take up the task and then stay in power if they do good. Its slow but it works , that is India's main advantage over china.
    Rest India has ambitious plans to give unique ID to every Indian using biometric scanner called Adhaar , this will help Gov't subsidized and welfare reach the much needed poor without middle men siphoning money out.
    India has taken up steps , gov't in India is slow but the business are working at break neck speed and are growing as a result in addressing huge local consumption. Another point which separates India from other countries like China , is that it has huge local consumption compared to pure export oriented businesses .
    India is slow but it is moving in right direction and most of the fundamentals are very good ( Thriving Democracy , Secular society, Relatively good level of freedom and economically liberalization. and very entrepreneurial and aspirational population )

    November 28, 2011 at 9:28 am |
  12. Grego

    I think if your country is beyond a certain point of corruption...it should not even qualify as a BRIC. Why encourage corrupt countries to benefit from economic development and foreign investment?

    November 28, 2011 at 9:53 am |
  13. Paulo

    Watching CNN, someone could think that Brazil is just a hispanic communist island, full of favelas and trash deposits...

    November 28, 2011 at 11:34 am |
  14. Paulo

    In fact, CNN loves to make trash news about Brazil, India and Russia... Everything about Brazil is biased and sensationalized (such as trash deposits, dirty wallls, favelas, junk)... Russia and Brazil suffers with the communist-phobia of CNN, that still thinks that we are in the Cold War.

    India and Brazil are showed like trash deposits of miserable people. I just realized that India has very developed cities reading the Xinhua...

    I mean... I don´t know what CNN wants with this very dirty vision of BRICs, but the victim is not Brazil Russia and India... The victim are the Americans that are reading this newspaper, becomming more misinformed about the World.

    November 28, 2011 at 11:43 am |
  15. Sanjib

    BRICs will be even more prosperous and economically strong if INDIA and CHINA works together and NOT against each other. They need to stay friendly, peaceful and cooperative to each other. It is something like: what is wrong if two very good guys study in a same class...?

    November 28, 2011 at 11:57 am |
  16. Robert G

    As long as Russia is considered a part of the BRIC(S), the name has no real meaning.
    Russia is only a supplier of raw materials, nothing more. To become a real upcoming economy, they would have to change very much, maybe to much for them

    November 28, 2011 at 12:38 pm |
  17. yonex badminton

    I agree with you, but please look at yonex badminton rackets.

    November 28, 2011 at 1:03 pm |
  18. Ed

    Bankers: Bernanke, Greespan, Wolfowitz, Wolfesohn, Zoellick, Blankenfein, Rothschild. What do all of these big international bankers have in common? Syria, Libya, Iran, Iraq, Cuba, N. Korea, Sudan – all getting private central banks run by the same people.

    November 28, 2011 at 1:18 pm |
  19. EA Marco Polo

    BRIC and CIVETS (Columbia, Indonesia, Vietnam, Egypt, Turkey and South Africa) are all nice countries. They are progressing and improving fast in various fields.

    Many positive developments of the world should be known; the US media should make change to report the fair world. In reality lots of people like to read positive information; repeating to emphasize foreign disaster or unrest is boring.

    BRIC and CIVETS could unite together harmoniously to make more progresses. Possibly the total import of BRIC will surpass the US or EU in near future. In 2029, the world would be more balanced and wonderful.

    November 28, 2011 at 1:59 pm |
  20. Fernando

    Oh, we are just third world nations, full of extreme misery, the hell... I think you´d better to stay where you are, in the heaven of the first world, a magical place where everything is always ok...

    December 1, 2011 at 12:37 pm |
  21. Taufiq

    Iraq was poor. It Iraq was poor. It had a weak minded leedar. But even that was not enough he head to disarm himself. And only after he disarmed his army the brave Americans dared to attack Iraq. On the other hand a country having strong leedars (like Iran) could be no easy target as long as the country is determined to defend its rights. And the dogs only bark and bark and bark for almost 3 decades. The dogs are scared that they could finish dead before they even start. And that's why they keep barking

    May 14, 2012 at 7:21 pm |

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