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BRICs presentation

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Anastassia Ševtšenko

on 20 January 2014

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Transcript of BRICs presentation

BRIC COUNTRIES
What is BRIC?
Population
Trade
BRIC countries account for more than
25% of global GDP
Position in world economy
FDI of BRIC
For some time now,
B
razil,
R
ussia,
I
ndia, and
C
hina have been grouped together under the acronym
BRIC
.
Why BRIC?
The BRIC position argues that, since the four countries are "
developing rapidly
," their combined economies could eclipse the collective economies of the current richest countries of the world by
2050

Some sources suggest that they might overtake the
G7
economies by
2027

BRICs encompass over
25%
of the world's land coverage and
40%
of the world's population
The enormous populations that exist within the BRIC nations makes it relatively easy for their aggregate wealth to
eclipse the G7
Together, BRIC countries comprise more than
2.8

billion
people
EU and BRIC
Timeline
Interactive part
Brazil
Russia
India
China
South Africa
VIDEO
CRISIS
Criticism
Potential
BRICS development bank
sources
Thank you for your attention!
18%
of global trade
China -
largest
exporter and second largest importer
Brazil, India, Russia -
top 20


SECTORS:
heterogeneous

BRAZIL
: agriculture services
RUSSIA
: energy, services
INDIA
: agriculture, services
CHINA
: energy and mineral resources;
industry and manufacturing

learning from one another
FDI - foreign direct investment
Inward FDI pattern
-
almost half of FDI flows to BRICS flow to China (
46%
), followed by Brazil (
25%
), then Russian Federation (
17%
) and India (
10%
)

Outward FDI pattern
-
42%
of BRIC outward stock is in developed countries.
China and Russia account for the lion's share of flows from the grouping.
Partnership
with countries, not a group

EU-
Brazil
: climate change, sustainable energy, trade
EU-
Russia
: economic and environmental issues, energy ( New Member States)
EU-
India
: dialogue, summits, meetings
EU-
China
: biggest trade partner (Luxembourg, Netherlands, Hungary, the UK)

Manufacturing industry >90% of total trade

2001
The acronym was coined by Jim O'Neill in a paper entitled "Building Better Global Economic BRICs"
2003
Goldman Sachs predicted the economic and geopolitical influence of BRICS
follow up reports in
2004
and
2007

2009
First BRIC summit held in Russia (Yekaterinburg)
2010
South Africa joins ( BRIC -> BRICS)
1) GDP per capita
2) Unemployment rate
3) Percentage of population living under 2$ per day
4) Birthrate
5) Gross national income
per capita
6) Happiness index


7th in terms of nominal GDP , PPP
one of the fastest growing economies
DOES BRAZIL TAKE OFF?

Positive points:
already highly
industrialized
nation,
good
educational
system,
largest mass in the world with vast
natural resources
,
$10 billion fund
managed by Goldman Sachs
Negative points
:
extraordinary dependence on the
energy sector
continuing
loss of human capital
poor
business climate
problematic political system
shrinking population
corruption
Negative points:
inability to raise its share of global
FDI
high
inflation
depreciating
Indian rupee
inefficient
government
difficult to do
business
limited
infrastructure
corruption
Positive points:

consistent
growth
of GDP (6-7% per annum)
growing
middle class
with a desire to consume
has one of the
youngest
populations
global supplier of
services
World's
most populous
country
reforms
top
trading
nation
largest
manufacturing
nation
Choice between Nigeria and South Africa

richest
counrty in terms of mineral reserves, largest producer of platinum, chrome
3rd largest gold miner
oil, metals, minerals, food, nateral resources


The BRIC countries come out remarkably well from the crisis

Example of the crisis in 2008
good but not unscrathed
developed countries recession-> BRIC is set to slow as well
Foreign exchange reserves and growth domestic product

Consequences of weaker demand in the US and Europe for China, Brazil, India, Rusia

Surplus and foreign-exchange reserves


"MARSHAL PLAN" capital flows

Foreign exchange resources
Growing domestic demand

25% of global GDP,
40% gold hard currency resources



China is and will
overshadow
the other BRICs
China's and Russia's large-scale disregard for
human rights
and
democracy
could be a problem in the future
declining
population
high level of
corruption
Forecast
official launch March 2014
$100 billion fund
Aim:
finance
infrastructure
and
development
projects
in the BRICS
countries and pool
foreign
currencies
to fend off any future
financial crisis.
http://blogs.wsj.com/moneybeat/2013/08/23/china-only-bric-country-currently-worthy-of-the-title-oneill/
http://economictimes.indiatimes.com/opinion/view-point/rapid-gdp-growth-growing-middle-class-will-lead-to-india-powering-the-world/articleshow/7300851.cms
http://www.eriks.co.uk/KnowHow/BRICs-threat-or-opportunity/3401
http://www.theguardian.com/world/2011/apr/19/south-africa-joins-bric-club
http://www.globalsmes.org/news/index.php?func=detail&detailid=556&catalog=28&lan=en&search_keywords=
http://en.wikipedia.org/wiki/BRIC
http://www.economist.com/blogs/economist-explains/2013/03/economist-explains-why-south-africa-brics
http://www.businessinsider.com/2013-ugly-year-for-brics-2013-1
http://www.globalresearch.ca/bric-becomes-brics-emerging-regional-powers-changes-on-the-geopolitical-chessboard
http://www.economist.com/news/briefing/21582257-most-dramatic-and-disruptive-period-emerging-market-growth-world-has-ever-seen
http://indrus.in/blogs/2013/12/30/five_reasons_why_the_world_needs_the_brics_bank_32033.html
http://www.economist.com/blogs/freeexchange/2013/05/global-economy
http://www.globalsherpa.org/bric-countries-brics
http://www.economist.com/news/leaders/21586833-stagnant-economy-bloated-state-and-mass-protests-mean-dilma-rousseff-must-change-course-has
http://www.billlosey.com/blog/the-potential-of-the-bric-nations.php
http://www.brics5.co.za/assets/Brics-Trade-Exchange.pdf
http://blog.euromonitor.com/2008/11/bric-economies-withstand-global-financial-crisis.html







Łukasz Chrabański
Anastassia Ševtšenko
natural resources
strong local industry
efficiency
3 largest food exporter
manufacture jewels
burdensome tax code
absurd pensions
lousy transport links
BRIC BRIMCK

A new alliance?
Heading towards coalition

Commanding global attention
Negative points
:
Positive points:
Positive points:
Larger receiver of foreign direct investments
High market demand
Low labour cost
Negative points:
Social geographical inequality
Energy and resource risks
E-commerce
Full transcript